Gold prices rose in local markets during trading on Tuesday, with the ounce rising on the global stock exchange due to increased demand, driven by renewed geopolitical tensions and growing economic uncertainty regarding the US Federal Reserve's monetary policy.
Gold prices rose in local markets by about 70 Egyptian pounds compared to yesterday's closing price, with the price of a gram of 21-karat gold reaching 4,810 Egyptian pounds, while an ounce rose by about $40, reaching $3,377.
A gram of 24-karat gold reached 5,497 Egyptian pounds, a gram of 18-karat gold reached 4,123 Egyptian pounds, while a gram of 14-karat gold reached 3,207 Egyptian pounds, and the gold pound reached 38,480 Egyptian pounds. Gold prices rose by EGP 105 in the markets during trading on Monday, with the 21-karat gold gram opening at EGP 4,635 and closing at EGP 4,740. Meanwhile, the ounce rose by $96, opening at $3,241 and closing at $3,337.
The rise in gold prices in local markets was driven by the rise in the ounce on the global stock exchange, which reached its highest level in two weeks. This was due to geopolitical tensions and market anticipation of the US Federal Reserve's interest rate decision, which boosted demand for safe haven assets.
Increasing geopolitical instability and volatile economic indicators are enhancing the attractiveness of gold and silver in the near term. While US economic data showed improvement, the Institute for Supply Management (ISM) reported that its services sector Purchasing Managers' Index (PMI) rose to 51.6 in April, up from 50.8 in March, indicating steady growth. Meanwhile, last week's employment report revealed stronger-than-expected job growth, adding to optimism about the US economy.
Many analysts expect the Federal Reserve to keep interest rates unchanged at its meeting tomorrow, Wednesday, amid political pressure from US President Donald Trump to cut rates.
All eyes will also be on Jerome Powell's remarks during the press conference following the Monetary Policy Committee meeting for strong signals on the timing and pace of potential interest rate cuts this year, which will determine the fate of gold prices.
Bloomberg reported that the Shanghai Gold Exchange plans to expand its warehouse network to Hong Kong, helping to strengthen the position of its yuan-denominated products, including the precious metal, outside mainland China. Meanwhile, Goldman Sachs said that strong central bank gold purchases, slowing solar energy production in China, and rising risks of a US recession are likely to keep gold's performance high in the coming period.