Gold Falls EGP 190 in May as 2026 Gains Narrow to EGP 935 per Gram

Gold prices in Egypt’s local market declined by 2.7% during May 2026, while global gold prices fell by 1%, amid continued geopolitical uncertainty in the Middle East and growing expectations that the U.S. Federal Reserve will maintain its restrictive monetary policy for longer, according to a report issued by Marsad Al Dahab for Economic Studies.

The report noted that 21-karat gold opened May trading at EGP 6,955 per gram before falling to a monthly low of EGP 6,690. Prices later recovered part of their losses and closed the month at EGP 6,765 per gram, representing a decline of EGP 190 from the beginning of the month.

Meanwhile, 24-karat gold was priced at EGP 7,949 per gram, 18-karat gold at EGP 5,961 per gram, while the gold pound coin reached EGP 55,640.

On the global market, gold lost $77 per ounce during May. The metal opened the month at $4,617 per ounce, fell to a low of $4,366, rebounded to $4,595, and ultimately settled at $4,540 per ounce at month-end.

During the final week of May, local gold prices declined by 1%, with 21-karat gold losing EGP 65 per gram after opening the week at EGP 6,830 and closing at EGP 6,765.

In contrast, the global gold market recorded weekly gains of approximately $30 per ounce. Gold opened the week at $4,510, dropped to $4,366, rose to $4,595, and ended the week at $4,540 per ounce.

Despite recent declines, gold continues to post a strong year-to-date performance. Local gold prices have risen by 16% since the beginning of 2026, equivalent to EGP 935 per gram, with 21-karat gold climbing from EGP 5,830 at the start of the year to EGP 6,765 at the end of May.

Globally, gold remains up 5% year-to-date, gaining $222 per ounce after opening the year at $4,318 and reaching record highs during the first quarter before stabilizing near $4,540 by the end of May.

The report highlighted that local gold prices remain approximately EGP 106 per gram above their global equivalent due to weak activity in Egypt’s raw gold market, reduced liquidity ahead of the Eid al-Adha holiday, and ongoing uncertainty surrounding future movements in the exchange rate.

Difficulties in securing foreign currency needed for gold imports have also encouraged market participants to maintain precautionary pricing strategies. As a result, local prices have been slower to respond to declines in international markets, widening the gap between domestic and global gold prices.

Global financial markets experienced one of their most complex periods in recent years during May, as geopolitical tensions in the Middle East coincided with elevated energy prices, persistent inflationary pressures, rising global bond yields, and record-high equity markets.

Gold retreated from the historic highs recorded during the first quarter of the year as investors shifted their focus from geopolitical risks themselves to their inflationary consequences and implications for monetary policy. This reinforced expectations that interest rates may remain higher for longer.

At the same time, a sell-off in global bond markets pushed long-term U.S. Treasury yields to their highest levels in years, reducing gold’s appeal among yield-seeking investors and contributing to a broader repricing of financial assets worldwide.

Oil prices also played a significant role in market movements during May. Concerns over disruptions to shipping routes in the Gulf initially pushed prices sharply higher before easing as fears over supply constraints diminished, influencing inflation expectations and affecting gold, bond, and equity markets alike.

Despite the pressure on gold prices, central banks continued to support the market through strong purchases totaling approximately 244 tonnes during the first quarter of 2026, led by China, Poland, and Uzbekistan. These acquisitions reflect a long-term strategy aimed at diversifying reserves and reducing dependence on the U.S. dollar.

The report emphasized that growing speculation about the collapse of the global financial system or the imminent decline of the dollar’s dominance is not supported by current data. The U.S. dollar still accounts for the largest share of global foreign exchange reserves, while the U.S. Treasury market remains the world’s largest and most liquid.

According to the report, current developments point to a gradual transformation of the global financial system rather than an impending crisis. In the near term, gold’s trajectory will remain closely linked to U.S. monetary policy, inflation trends, and geopolitical developments, while long-term support is expected to continue from central bank purchases and concerns over rising U.S. debt levels.