Gold Hits Record High Amid Middle East Tensions

Gold prices surged to unprecedented levels on Saturday, fueled by rising geopolitical tensions in the Middle East and uncertainty surrounding the upcoming US elections.

Despite the global markets being closed for the weekend, gold's value continued to climb, reflecting heightened demand for safe-haven assets. The metal posted a 2.4% gain by the end of the week, driven by expectations of global monetary easing as central banks prepare for deeper interest rate cuts to counter slowing inflation.

In Egypt’s local markets, gold prices saw a sharp increase. Saeed Imbaby, CEO of the online gold trading platform iSagha, confirmed that 21-karat gold, the most popular standard in Egypt, rose by 5 EGP per gram, reaching 3,690 EGP compared to the previous day's close.

The upward trend aligns with global markets, where gold closed the week at $2,721 per ounce—a new all-time high—after gaining $64 throughout the week. This surge in global prices has made gold more attractive as a hedge against political and financial risks.

Imbaby also highlighted the broader movement in gold prices across the local market. 24-karat gold reached 4,217 EGP per gram, while 18-karat gold climbed to 3,163 EGP per gram. The gold pound—an eight-gram coin—now trades at 29,520 EGP, reflecting the strong upward momentum in both global and local markets.

Gold's remarkable rise in 2024 has been a standout trend in global financial markets. The metal has gained 32% year-to-date, adding $659 per ounce, while Egypt's local gold market has seen prices rise by more than 16% over the same period. This rally reflects the weakening of the US dollar and a decline in US Treasury yields, both of which have made gold more attractive to investors seeking safe-haven assets.

The escalation of tensions in the Middle East has also played a crucial role in the metal’s rise. Gold broke past the $2,700 per ounce threshold following Hezbollah’s threats to intensify conflict after the death of Yahya Sinwar, a prominent Hamas leader, killed by Israeli forces. These developments have amplified investor concerns about further instability, fueling the surge in demand for gold.