Marsad Al Dahab reported that gold prices in the Egyptian market and global bullion markets moved higher during Monday’s mid-session trading, supported by improved investor sentiment following the announcement of a preliminary framework agreement between the United States and Iran aimed at ending the conflict between the two countries, easing concerns over inflation and interest rates.
The price of 21-karat gold, the most widely traded gold product in Egypt, rose by EGP 30 compared with last week’s closing level to reach EGP 6,310 per gram. Meanwhile, the global gold ounce gained approximately $116, reaching $4,335.
The price of 24-karat gold reached EGP 7,211 per gram, while 18-karat gold recorded EGP 5,409 per gram. The gold pound coin stood at approximately EGP 50,480.
The limited rise in local gold prices compared with the strong gains recorded in global markets was mainly attributed to the significant decline in the U.S. dollar against the Egyptian pound. The weaker dollar prevented the full impact of global gold gains from being reflected in domestic prices, despite the sharp rise in the international ounce price.
The U.S. dollar fell by around 67 piastres against the Egyptian pound in several banks during morning trading, reaching its lowest level in more than three months.
Marsad Al Dahab also noted that the pricing gap between local gold prices and the fair value based on international gold prices and the official exchange rate widened to around EGP 170 per gram, amid continued demand for gold and bullion purchases as consumers sought to take advantage of recent price declines.
Gold prices have remained under pressure since the beginning of June. Local prices have declined by approximately EGP 485 during the first two weeks of the month, while the global ounce lost around $321, weighed down by higher U.S. inflation readings and reduced expectations of interest-rate cuts.
During the previous week alone, 21-karat gold fell by EGP 195, or 3%, closing at EGP 6,280 per gram. The global ounce also declined by $109, or 2.5%, ending the week at $4,219.
Gold extended its gains on Monday following reports that U.S. and Iranian officials had reached a preliminary understanding that could pave the way for ending the conflict and restoring normal navigation through the Strait of Hormuz. The development boosted global market sentiment, pressured oil prices lower, and weighed on the U.S. dollar.
The precious metal also benefited from the decline in the U.S. Dollar Index, which increased gold’s attractiveness to investors holding other currencies, while improving risk sentiment supported broader financial markets.
Investors are now focusing on the upcoming U.S. Federal Reserve meeting scheduled for Wednesday. Markets widely expect policymakers to leave interest rates unchanged, while attention will center on updated economic projections and comments from Federal Reserve Chairman Kevin Warsh regarding the future path of monetary policy during the second half of the year.
Marsad Al Dahab believes that recent progress in U.S.-Iran negotiations has supported the current recovery in gold prices. However, markets remain cautious until a formal agreement is signed and implemented, particularly given the existence of several unresolved geopolitical issues.
The report notes that gold successfully rebounded from the major support zone near $4,000 per ounce, gaining more than $300 over three consecutive trading sessions. However, the metal is currently facing a significant technical resistance level around $4,360 per ounce.
A decisive breakout and sustained trading above this level could pave the way toward the $4,500 mark in the coming period. Failure to overcome this resistance may trigger renewed selling pressure and a retest of the $4,000 support zone.
Markets are also awaiting a series of key economic releases this week, including U.S. retail sales, industrial production, and weekly jobless claims data, alongside monetary policy decisions from the Federal Reserve, the Bank of Japan, the Swiss National Bank, and the Bank of England. These events are expected to play a crucial role in determining gold’s direction during the second half of June.
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