Gold prices in Egypt saw a decline on Monday, while global gold rates rose, driven by inflation concerns and economic uncertainty. As government debts continue to climb, markets worldwide are closely watching Donald Trump’s return to the White House and his inauguration speech later today for insights into his policies and their potential impact on the economy, including anticipated interest rate cuts.
According to a report by iSagha, a leading online gold and jewelry trading platform, local gold prices dropped by EGP 20 during today’s trading session compared to Saturday’s closing prices. Gold of 21 karat was priced at EGP 3,760 per gram. Meanwhile, global gold prices increased by $6 per ounce, reaching $2,709.
Saeed Embabi, CEO of iSagha, highlighted the latest gold prices across categories:
24-karat gold: EGP 4,297 per gram
18-karat gold: EGP 3,223 per gram
14-karat gold: EGP 2,507 per gram
Gold pound (8 grams of 21-karat): EGP 30,080
The weekly iSagha report showed that domestic gold prices declined by 0.5%, or EGP 20, last week. Gold of 21 karat opened the week at EGP 3,800, dropped to EGP 3,750, and closed at EGP 3,780. Conversely, global gold prices rose by 0.5%, or $14 per ounce, beginning the week at $2,689 and ending at $2,703.
Factors Influencing Gold Prices
Embabi noted a liquidity shortage in the Egyptian market, causing a price gap of approximately EGP 78 per gram between local and global gold prices. This discrepancy reflects the exchange rate in the local market versus global benchmarks.
On the global stage, gold prices surged last week, buoyed by anticipation of Trump’s inauguration and heightened expectations of interest rate cuts by the U.S. Federal Reserve in the first half of 2025. These expectations are fueled by rising U.S. inflation rates and increasing unemployment.
Recent inflation data and statements from Federal Reserve officials have put downward pressure on the U.S. dollar. Investors now widely expect the Federal Reserve to cut interest rates soon, with a possible reduction during the March meeting, as inflation nears the 2% target.
Trump’s Impact on Gold and the Economy
Trump’s aggressive rhetoric regarding trade tariffs continues to bolster the U.S. dollar while simultaneously sparking fears of inflation and slower economic growth due to potential global trade wars.
In his recent remarks, Trump proposed tariffs of up to:
- 10% on global imports
- 60% on Chinese goods
- 25% on Canadian and Mexican products
Gold, being a financial asset, is likely exempt from broad tariffs. Goldman Sachs estimates only a 10% chance of a 10% effective tariff on gold within the next 12 months.
Giovanni Staunovo, an analyst at UBS, stated:
“Trump’s presidency could lead to heightened market volatility. Some of his policies might keep inflation elevated longer, which should continue to support safe-haven assets like gold.”
Markets are also awaiting key economic indicators this week, including initial jobless claims and flash PMI data, which could further influence gold prices and economic projections.
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