Gold prices rose in local markets during Saturday’s trading, in line with the weekend closure of global exchanges, after the ounce recorded strong weekly gains exceeding 8.5%, driven by increased demand for the yellow metal as a safe haven, according to a report issued by the iSagha platform.
Saeed Imbaby, Executive Director of the platform, said that gold prices in the local market increased by around EGP 30 per gram, with 21-karat gold — the most traded — reaching EGP 6,700. Meanwhile, the ounce in global markets jumped by about $392 over the course of the week to record $4,988.
Imbaby added that 24-karat gold recorded approximately EGP 7,657 per gram, while 18-karat gold stood at around EGP 5,743. The price of the gold pound rose to about EGP 53,600.
Global gains driven by safe-haven demand and a weaker dollar
Gold posted gains exceeding 8% in global markets over the week, supported by rising demand for safe-haven assets amid ongoing geopolitical and economic uncertainty worldwide, in addition to the weak performance of the U.S. dollar.
Mixed U.S. economic data failed to provide meaningful support for the greenback, allowing gold to continue its upward momentum. Although some tensions eased midweek after U.S. President Donald Trump announced a retreat from previous threats to impose tariffs on several European countries following the announcement of a future framework agreement regarding Greenland, the lack of binding details limited the impact of this development on gold prices.
Investors remain cautious toward these developments amid doubts over the ability to fully contain tensions, keeping demand for the precious metal elevated.
Mixed U.S. data weigh on the dollar
Data from the University of Michigan’s January survey showed an improvement in consumer sentiment, with the Consumer Expectations Index rising to 57 points from 55 previously, while the Consumer Sentiment Index increased to 56.4 points compared with 54.
In contrast, one-year inflation expectations declined to 4.0% from 4.2%, and five-year inflation expectations fell to 3.3% from 3.4%. Meanwhile, core personal consumption expenditures (PCE) inflation held steady at 2.9%, while initial jobless claims rose to 200,000.
U.S. trade policies heighten concerns
Analysts believe that the trade agenda of U.S. President Donald Trump, and his repeated reliance on tariffs as a political pressure tool, have contributed to eroding investor confidence in U.S. assets, increasing concerns over the dollar and pushing investors toward gold.
In this context, Trump announced the completion of interviews to select the next Chair of the Federal Reserve, with expectations of an official announcement before the end of January. Markets fear that appointing a new Fed Chair could lead to a more accommodative monetary policy, particularly amid Trump’s repeated criticism of current Fed Chair Jerome Powell for not cutting interest rates faster.
Monetary policy and momentum in precious metals
On the monetary policy front, recent U.S. economic data reinforced expectations that the Federal Reserve will keep interest rates unchanged at its January 27–28 meeting, with the likelihood that the current policy stance will continue throughout the first quarter of the year.
The precious metals sector has started the year with strong momentum, with silver prices surpassing $100 per ounce and gold approaching the $5,000 level. Despite signals of overbought conditions, analysts stress that the rally is underpinned by solid fundamental factors.
Ole Hansen, Head of Commodity Strategy at Saxo Bank, said momentum has become part of the landscape, driven by fear of missing out as prices reach unprecedented levels. However, he emphasized that the broader macroeconomic backdrop still favors precious metals, supported by strong central bank demand and growing doubts over fiscal discipline and the sustainability of global debt.
Reshaping the global financial system
Despite a relative easing in geopolitical tensions, U.S. political pressure on the European Union remains, prompting some European institutions to reassess their holdings of U.S. Treasuries. In this regard, a Danish pension fund announced plans to sell $100 million worth of U.S. bonds by the end of the month.
Analysts believe that current gold price levels appear reasonable given central bank accumulation and geopolitical tensions, suggesting that the situation is closer to a currency devaluation process than a speculative bubble.
Bank of America raises gold target to $6,000
As gold approaches the $5,000-per-ounce threshold — once considered unattainable — Bank of America raised its short-term gold price target to $6,000 per ounce, making it the most bullish among major global financial institutions.
Michael Hartnett, the bank’s Chief Investment Strategist, said historical gold bull markets could push prices to that level by next spring. Meanwhile, Michael Widmer, Head of Metals Research at Bank of America, confirmed that gold will remain a core component of investment portfolios in 2026.
The bank noted that declining supply and rising production costs support prices, forecasting a 2% drop in output from 13 major North American mining companies to 19.2 million ounces, alongside an increase in all-in sustaining costs (AISC) to around $1,600 per ounce.
Positive outlook and continued momentum
Bank of America expects the average real price of gold to reach about $4,538 per ounce in 2026, with positive prospects for other precious metals, particularly silver, which may be more attractive to investors with higher risk appetite.
Widmer stressed that gold has not yet reached its peak, noting that continued investment demand and central bank purchases could push prices higher, as markets await upcoming monetary policy decisions and key U.S. economic data.
Global markets are set to monitor a series of influential economic indicators next week, including U.S. durable goods orders, the Consumer Confidence Index, weekly jobless claims, and the Producer Price Index. Investor attention will also focus on monetary policy decisions by both the Bank of Canada and the U.S. Federal Reserve, given their direct impact on the dollar and precious metals markets, particularly gold.
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