Gold Edges Higher as Markets Await Federal Reserve Decision

Gold prices posted a slight increase in both local and global markets during Monday’s trading, amid heightened anticipation over U.S. monetary policy developments, as the Federal Open Market Committee convenes this week to determine the direction of interest rates, according to a report by the gold and jewelry trading platform "iSagha".

Saeed Embabi, CEO of the platform, said that local gold prices rose by a few pounds today compared with Saturday’s closing, with the price of 21-karat gold reaching EGP 5,620 per gram, while the global spot price added $9, hitting $4,208 per ounce.

He added that 24-karat gold recorded EGP 6,423, and 18-karat gold traded at around EGP 4,817, while the gold pound remained stable at EGP 44,960.

According to iSagha’s weekly report, local gold prices fell by EGP 35 over the past week, with 21-karat gold opening at EGP 5,650 and closing at EGP 5,615, while the global ounce fell by $17, starting at $4,216 and ending at $4,199.

Analysts believe the yellow metal is preserving modest gains as the dollar weakens, driven by rising expectations that the Federal Reserve will cut interest rates during its meeting scheduled for December 9–10, amid market caution and geopolitical uncertainty, which continue to support safe-haven assets.

Markets are closely watching comments from Fed Chair Jerome Powell and updated economic projections, as investors seek signals on whether a 25 basis point cut will be followed by further monetary easing.

A report from the U.S. Department of Commerce showed that the Personal Consumption Expenditure (PCE) price index rose 2.8% year-on-year in September, the Fed’s preferred inflation gauge, while signs of a cooling labor market reinforced expectations for additional stimulus.

Data from the CME FedWatch Tool indicates that markets are pricing in a nearly 90% probability of a rate cut this week, with another cut expected by April next year.

On the geopolitical front, escalating military action in Ukraine has boosted gold’s appeal as a safe haven, following a large-scale Russian drone strike on energy infrastructure, alongside slow-moving peace negotiations.

Despite supportive factors, investors appear reluctant to build large long positions ahead of the Fed decision and accompanying statement, especially as the anticipated rate cut has already been largely priced in.

In terms of price forecasts, Deutsche Bank raised its gold estimate for 2026 to $4,450 per ounce, up from a previous projection of $4,000, expecting prices to trade between $3,950 and $4,950 next year, while maintaining its 2027 forecast at $5,150.

Meanwhile, Morgan Stanley expects gold to reach $4,500 per ounce by mid-2026, supported by ETF inflows and official sector buying, against a backdrop of ongoing global economic uncertainty.