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Editor in Chief Mohamed Wadie

Gold Prices Experience Significant Downturn as 21-Karat Drops by 800 EGP

Gold Prices

Mon 05 Feb 2024 | 09:09 PM
Waleed Farouk

In a significant downturn, gold prices in Egypt's local markets experienced a sharp decline during Monday's trading session, paralleling a fall in global gold prices. This drop was influenced by recent remarks from the U.S. Federal Reserve Chairman, which tempered expectations for an imminent cut in interest rates.

Saeed Embabi, CEO of "iSagha," an online platform for trading gold and jewelry, noted that gold prices fell by about 260 EGP in today's trading compared to Saturday's close. The price of 21-karat gold per gram dropped to approximately 3300 EGP, culminating in an overall decrease of around 800 EGP since last week when it nearly reached 4100 EGP per gram. On the global stage, the price per ounce decreased by roughly 15 USD to 2025 USD.

Embabi detailed the current rates for various gold karats: 24-karat at 3772 EGP per gram, 18-karat at 2829 EGP per gram, and 14-karat at about 2200 EGP per gram. The gold pound (8 grams of 21-karat gold) is now valued at about 26400 EGP.

Previously, gold prices in the local market had dropped by 13%, or 520 EGP, from the 4100 EGP per gram trading price of 21-karat gold. By the end of the previous week, the price had adjusted to 3560 EGP. Conversely, last week saw a 1% increase, or 21 USD, in global gold prices, with the ounce starting at 2019 USD, peaking at 2060 USD, and closing at 2040 USD. This was largely due to market confidence in the Federal Reserve's potential reduction of interest rates starting in March.

Further impacting local gold prices, Embabi highlighted, were developments such as the preliminary agreement between Egypt and the International Monetary Fund and Emirati investments in Ras Al Hikma, which contributed to a decrease in the local dollar exchange rate and, subsequently, gold prices.

In a recent interview, the Federal Reserve Chairman emphasized a cautious approach to interest rate cuts this year, suggesting a slower pace than market expectations. He stressed the need for more evidence of inflation moving towards the 2% target before any steps towards reducing interest rates are taken. At its January meeting, the Federal Reserve decided to keep interest rates steady, maintaining them between 5.25% and 5.5%.