Gold Prices Drop 3.4% Amid Market Volatility

Gold prices on the global market fell by 3.4%, equivalent to a decrease of $81, during the trading week ending Friday evening. This marks the largest weekly loss since December 2023, influenced by the recent Federal Reserve meeting minutes, which reinforced the likelihood of raising interest rates to combat persistent inflation.

Saeed Imbabi, Executive Director of the online gold and jewelry trading platform "iSagha," reported stability in local gold markets today compared to the close of trading yesterday. The price of 21-karat gold remained at 3,120 Egyptian pounds per gram. This coincides with the global market's weekly closure, with gold closing yesterday at $2,333 per ounce after reaching an all-time high of $2,451 on May 20.

Imbabi noted that 24-karat gold is priced at 3,566 Egyptian pounds per gram, 18-karat gold at 2,674 Egyptian pounds per gram, and 14-karat gold at 2,080 Egyptian pounds per gram. The price of a gold pound is approximately 24,960 Egyptian pounds.

Gold prices had dropped by 10 Egyptian pounds during Friday's trading, starting at 3,130 Egyptian pounds per gram for 21-karat gold and closing at 3,120 Egyptian pounds. Meanwhile, the price of an ounce rose by $16, opening at $2,341 and closing at $2,333.

He explained that global gold markets experienced significant price fluctuations this week, reaching historical highs before undergoing dramatic sell-offs. Prices peaked on Monday at $2,451 for spot transactions but faced instability starting Tuesday.

The gold market witnessed a sharp decline following the release of the latest Federal Reserve minutes on Wednesday, which revealed concerns among members about persistent inflation rates. This has increased the likelihood of further interest rate hikes.

The minutes indicated that it would take longer than previously expected for inflation to move sustainably towards the 2% target, prompting further caution.

Imbabi highlighted that gold prices showed relative stability towards the end of the week due to a weaker dollar and positive economic data that mitigated the extent of the decline. The U.S. Department of Commerce reported positive April durable goods data, with orders rising by 0.7% month-on-month, exceeding the anticipated contraction of -0.8%.