Gold prices recorded slight increases in both local and global markets during Tuesday’s trading session, amid broad anticipation of upcoming U.S. monetary policy decisions. The Federal Open Market Committee is meeting this week to determine the direction of interest rates. According to a report by the gold and jewelry trading platform iSagha, the latest movements reflect heightened caution among investors ahead of the much-anticipated policy announcement.
Saeed Embabi, CEO of iSagha, stated that local gold prices rose by 15 EGP today, pushing the price of 21-karat gold to 5,620 EGP per gram, while the global ounce increased by $12, reaching $4,203.
He added that 24-karat gold stood at 6,423 EGP, 18-karat gold at 4,817 EGP, while the gold sovereign coin stabilized at 44,960 EGP.
The report noted that gold prices had declined yesterday, Monday, by 10 EGP, with 21-karat gold opening at 5,615 EGP and closing at 5,605 EGP, while the global ounce fell by $8, closing at $4,191 after opening at $4,199.
Gold continues to experience volatility in local and international markets as investors await the outcome of the U.S. Federal Reserve meeting today and tomorrow, amid rising expectations of a 25-basis-point interest rate cut. Market participants are expected to closely monitor updated economic projections, the “dot plot”, and the press conference by Federal Reserve Chair Jerome Powell, all of which may signal the future pace of rate cuts—an influential factor shaping demand for the U.S. dollar and the performance of the non-yielding yellow metal.
At the same time, expectations that the U.S. central bank will indeed lower borrowing costs this week—alongside further expected cuts in 2026—are helping the dollar attempt to recover from its lowest level since last October. Geopolitical uncertainty stemming from the prolonged Russia–Ukraine conflict continues to support gold’s status as a safe haven, limiting downside pressures.
The U.S. Personal Consumption Expenditures (PCE) inflation reading released last Friday had little impact on expectations of further monetary easing. Traders now estimate that the probability of a 25-basis-point rate cut exceeds 85% by the end of Wednesday’s meeting.
Conversely, cautious expectations regarding the dollar failed to lend meaningful support to its recent modest rebound, instead boosting gold’s appeal.
Investors are also awaiting key U.S. economic data today, including the ADP employment report and JOLTS job openings, which could influence the Fed’s policy outlook.
On an annual basis, gold climbed by more than 60% in 2025, driven by geopolitical risks, interest-rate cuts, and strong central-bank buying. Investors are now watching closely to determine whether the metal can sustain this momentum in 2026, especially after breaking more than 50 all-time record highs in 2025, putting it on track for its best annual performance since 1979.
Experts believe gold still has room for further gains, despite warnings of potential risks. A World Gold Council (WGC) report highlights the number of key drivers influencing the market this year—unlike previous years when a single factor dominated.
These factors include ongoing central-bank gold purchases, escalating geopolitical tensions, lower interest rates, and a weaker U.S. dollar, all of which strengthened investment demand for gold.
Each of these drivers contributed differently to this year’s performance:
Geopolitical tensions: +12 percentage points
Weak dollar and lower rates: +10 points
Investor sentiment and momentum: +9 points
Economic expansion: +10 points
Additionally, central banks continued heavy buying, keeping official-sector demand well above pre-pandemic levels.
The World Gold Council expects many of the supporting factors of 2025’s rally to persist into 2026. However, it notes that the starting point is different this time, as prices already reflect what it calls the “macro consensus”—stable global growth, moderate U.S. rate cuts, and a generally steady dollar. In this context, gold appears “fairly valued”, with stable opportunity costs and fading momentum compared to 2025.
Under its base-case scenario, the WGC forecasts gold trading within a narrow range in 2026—between -5% and +5%. Yet it outlines three alternative scenarios that could shift this trajectory:
Mild economic slowdown: Gold could rise 5%–15% as investors move toward defensive assets.
Deeper economic downturn (“doom loop”): Gains of 15%–30% driven by aggressive monetary easing, falling Treasury yields, and strong safe-haven flows.
Growth surge fueled by Trump administration policies: Gold could fall 5%–20%, as higher yields and a stronger dollar weaken demand.
Despite the WGC’s relatively cautious stance, major global investment banks remain more optimistic about 2026.
J.P. Morgan expects gold to trade between $5,200 and $5,300 per ounce.
Goldman Sachs forecasts around $4,900.
Deutsche Bank projects $3,950–$4,950, with a base case near $4,450.
Morgan Stanley anticipates prices approaching $4,500, while warning of near-term volatility.
Optimists argue that continued central-bank accumulation—especially in emerging markets—alongside relatively low institutional exposure to gold, offers room for further upside. Prospects of lower real yields and ongoing macroeconomic risks also reinforce gold’s role as a hedging tool.
However, downside risks remain:
A stronger-than-expected U.S. economic recovery or renewed inflationary pressures could force the Federal Reserve to delay or reverse rate cuts—strengthening the dollar and weighing on gold.
A slowdown in ETF inflows, reduced central-bank buying, or increased recycling—particularly in India, where gold is used as collateral—could also raise supply and pressure prices.
While a repeat of 2025’s extraordinary 60% rally appears unlikely, gold enters 2026 from a position of strength. The fundamental drivers—macro uncertainty, central-bank diversification, and gold’s value as a hedge against volatility—remain intact.
In a world increasingly characterized by unpredictability, gold continues to offer investors not only returns but resilience, maintaining its historic role as a strategic anchor in times of economic uncertainty.
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