A Relative Disconnect Emerges Between Local and Global Gold Markets as the Price Gap Approaches EGP 160 per Gram

Marsad Al Dahab reported that gold prices in the local market and global exchanges rose during Tuesday’s trading session, supported by a weaker U.S. dollar and falling oil prices following a preliminary agreement between the United States and Iran to reopen the Strait of Hormuz. Markets are also awaiting the U.S. Federal Reserve’s interest-rate decision.

The price of 21-karat gold increased by approximately EGP 35 compared with Monday’s closing level, reaching around EGP 6,300 per gram, while the global gold ounce gained about $26 to trade near $4,347.

Meanwhile, 24-karat gold reached EGP 7,200 per gram, 18-karat gold traded at EGP 5,400 per gram, and the gold pound coin stood at approximately EGP 50,400.

Gold prices had already risen during Monday’s session, with 21-karat gold opening at EGP 6,280 per gram, touching EGP 6,330 before closing at EGP 6,265. On the global market, the ounce climbed by $102, opening at $4,219, reaching a session high of $4,367, and ending at $4,321.

As a result, the gold ounce has gained more than $128 over the last two trading sessions, while 21-karat gold in Egypt increased by only EGP 20 compared with last week’s closing level, highlighting the direct impact of the recent decline in the U.S. dollar against the Egyptian pound.

Global markets received additional support from falling crude oil prices and lower U.S. Treasury yields after the preliminary U.S.-Iran agreement eased concerns over energy-related inflationary pressures. Brent crude declined by about 4.8%, while the yield on the 10-year U.S. Treasury note slipped to 4.47%.

Although geopolitical tensions have eased, investors remain cautious regarding developments surrounding the Iranian file, as the announced agreement is still preliminary and will require further negotiations before a comprehensive settlement can be reached.

The recent rise in gold despite lower geopolitical risk reflects a shift in market focus from safe-haven demand toward monetary factors. A weaker dollar and declining Treasury yields have provided significant support to bullion, offsetting the reduced demand for traditional safe-haven assets.

The Egyptian market is currently experiencing one of the most notable periods of relative divergence from global gold price movements this year. The decline in the U.S. dollar has absorbed a substantial portion of the gains recorded by the global market, limiting the transmission of international price increases into local prices.

The price gap between domestic gold prices and the fair value derived from global gold prices and the official exchange rate currently stands at around EGP 160 per gram, while demand for gold bars and investment products remains strong as buyers continue to take advantage of previous price declines.

Markets are now focused on Wednesday’s Federal Reserve meeting. While interest rates are widely expected to remain unchanged, investors will closely monitor policymakers’ guidance regarding the future path of monetary policy and the potential timing of rate cuts during the second half of the year.

Any hawkish signals from the Federal Reserve could place pressure on gold prices by supporting the U.S. dollar and Treasury yields, while a more dovish tone could provide additional upside momentum for bullion.

Investors are also watching a series of key economic indicators this week, including U.S. retail sales, industrial production, and jobless claims data, alongside monetary policy decisions from the Bank of Japan, the Swiss National Bank, and the Bank of England.

Despite recent corrections, gold continues to maintain strong annual gains, underscoring persistent investment demand amid ongoing uncertainty surrounding the global economic outlook.

 Central Banks Continue to Support Gold

The factors supporting gold extend beyond geopolitical developments and monetary policy. Strong and sustained demand from central banks remains one of the most important structural drivers of the market.

According to the latest 2026 Central Bank Gold Reserves Survey published by the World Gold Council, 45% of central banks intend to increase their gold holdings over the next 12 months, the highest level ever recorded since the survey began. In addition, 89% of respondents expect global central-bank gold reserves to continue rising during the same period.

The survey, which included 76 central banks worldwide, highlights the growing importance of gold as a strategic reserve asset amid increasing geopolitical and economic uncertainty.

The findings align with a recent Marsad Al Dahab study showing that central banks added approximately 4,335 tonnes of gold to official reserves between the beginning of 2022 and the end of April 2026, marking the largest accumulation wave in the modern monetary era and averaging more than 1,000 tonnes annually over the past four years.

Historical data indicate that central banks purchased 1,080 tonnes in 2022, followed by 1,051 tonnes in 2023 and 1,093 tonnes in 2024. Net purchases reached approximately 850 tonnes in 2025, while acquisitions during the first quarter of 2026 totaled 244 tonnes, rising to nearly 261 tonnes by the end of April.

These record purchases provide a long-term structural foundation for gold prices, even during periods of elevated interest rates or declining geopolitical tensions, while also reflecting growing efforts by nations to diversify reserves and reduce reliance on the U.S. dollar.

Marsad Al Dahab believes that current gold-price movements are being driven by three key factors: developments surrounding the Iranian issue, the future direction of U.S. monetary policy, and continued official-sector demand from central banks.

Recent market behavior suggests that investors are increasingly repricing inflation and interest-rate expectations following the decline in energy prices, leading to lower Treasury yields, a weaker U.S. dollar, and renewed investment flows into gold.

The continued decline of the dollar remains the most influential factor affecting local gold prices in Egypt, limiting the transmission of global gains into the domestic market and explaining the relatively modest rise in local prices compared with the strong rally in international markets.

At the same time, official-sector demand remains one of the strongest long-term support factors for gold. The addition of more than 4,300 tonnes to central-bank reserves since 2022 reinforces gold’s position as one of the world’s most important reserve and investment assets.

Marsad Al Dahab expects gold’s direction during the second half of June to depend primarily on the outcome of the Federal Reserve meeting, the durability of geopolitical de-escalation in the Middle East, and the continuation of central-bank purchases, all of which will play a decisive role in determining whether gold can maintain its elevated levels or resume its broader upward trend.