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Gold Prices See Historic Highs and Sharp Drops in Volatile Week


Gold Prices, gold

Sat 20 Jul 2024 | 10:59 PM
Waleed Farouk

Gold prices experienced significant volatility this week, reaching historic highs before sharply declining by the end of trading. In local markets, prices fell during Saturday's session, coinciding with the global market's weekend closure. The week saw gold prices reaching unprecedented levels before experiencing a substantial drop.

Saeed Embabi, CEO of the online gold and jewelry trading platform iSagha, reported a 15 EGP drop in gold prices during today's trading session compared to yesterday's close. The price of 21-karat gold settled at 3,265 EGP per gram, while an ounce of gold ended the week at $2,400, a 0.5% decrease equivalent to $11, after hitting an all-time high of $2,484 on Wednesday, July 17.

Embabi detailed that 24-karat gold recorded a price of 3,732 EGP per gram, 18-karat gold was at 2,799 EGP, and 14-karat gold stood at 2,177 EGP per gram. Additionally, the price of a gold pound was 26,120 EGP.

On Friday, local gold prices dropped by 30 EGP, with 21-karat gold opening at 3,310 EGP and closing at 3,280 EGP per gram. Meanwhile, global gold prices fell by $43, with an ounce starting at $2,443 and ending at $2,400.

Embabi commented on the dramatic journey of gold prices this week, noting that the ounce reached unprecedented heights before facing a sharp decline. This volatility reflects the complex relationship between market expectations of monetary policy and profit-taking forces.

The unprecedented rise in global gold prices was primarily driven by increasing expectations of an interest rate cut by the U.S. Federal Reserve in September. Federal Reserve Chairman Jerome Powell's comments about a potential rate cut before inflation hits the 2% target fueled the gold rally, pushing it to a record $2,484 per ounce.

Embabi also pointed out that the slowing Chinese economy and ongoing geopolitical tensions in Europe and the Middle East contributed to gold's strength. Global gold ETFs saw inflows for the second consecutive month in June, while demand in Asia remained sluggish due to profit-taking, with customers opting to sell at high prices rather than buy.