1.9% Weekly Surge in Global Gold Prices

Gold prices have seen significant growth globally and locally over the past week. According to a report from iSagha, an online platform for trading gold and jewelry, global gold prices increased by 1.9%, while local market prices rose by 0.9%. Saeed Imbabi, CEO of iSagha, reported that gold prices in local markets grew by approximately 35 EGP during the week, with the price of a gram of 21-karat gold opening at 3,765 EGP and closing at 3,800 EGP. On the global market, gold prices increased by $49 per ounce, ending the week at $2,689, up from $2,640.

Other notable prices in local markets included 24-karat gold at 4,343 EGP per gram, 18-karat gold at 3,257 EGP per gram, and 14-karat gold at 2,534 EGP per gram. The gold sovereign was priced at 30,400 EGP. On Saturday alone, gold prices in local markets rose by 15 EGP for 21-karat gold, coinciding with the global market closure over the weekend.

Imbabi highlighted that sluggish local demand prompted traders to export raw gold, creating a price gap between local and global markets, which peaked at 40 EGP earlier in the week before narrowing to 23 EGP. Current gold prices are considered favorable for investment, particularly as a hedge against economic uncertainty. However, gold's lack of yield makes it less appealing for some bank customers seeking regular returns to meet living expenses.

In 2024, gold prices in local markets rose by 18%, equating to an increase of 565 EGP per gram, while global prices saw a 27% rise, marking the highest annual growth since 2010. The surge was fueled by the Federal Reserve’s monetary easing policies, strong central bank purchases, and escalating geopolitical tensions.

Meanwhile, the U.S. economy demonstrated resilience, adding 256,000 jobs last month, surpassing expectations of 160,000. The unemployment rate fell to 4.1%, while average hourly wage growth slowed from 4% to 3.9%. These developments led traders to anticipate only one interest rate cut by the Federal Reserve in 2025. Federal Reserve officials expressed cautious optimism, emphasizing stability in the labor market and advocating for a careful approach to rate adjustments.

Market participants are closely monitoring upcoming data on producer and consumer inflation rates, retail sales, and weekly unemployment claims, which are expected to shape expectations for future Federal Reserve policy decisions.