Gold prices rose in local markets and on the global exchange during Wednesday’s trading, as the yellow metal regained momentum amid strong demand for safe-haven assets and growing expectations of a more accommodative monetary policy by the U.S. Federal Reserve, according to a report issued by the iSagha platform.
Saeed Embaby, CEO of iSagha, said that gold prices in the local market increased by about EGP 115 during today’s trading session, with 21-karat gold reaching approximately EGP 6,825 per gram. Meanwhile, global gold prices jumped by around $292, with the ounce trading near $5,053.
According to the report, 24-karat gold recorded about EGP 7,800 per gram, while 18-karat gold stood at around EGP 5,850. The gold pound reached approximately EGP 54,600.
Globally, gold prices rose for the second consecutive day on Wednesday, climbing above the $5,000 per ounce level, amid calmer market conditions ahead of the release of the U.S. ADP employment change report, scheduled for later in the day.
Precious metals have remained influenced by the stability of the U.S. dollar, supported by the end of a two-day government shutdown and positive reactions to the nomination of Kevin Warsh as Chairman of the Federal Reserve. However, the recent rally in the U.S. dollar appears to have stalled.
In this context, the ADP report is expected to determine the near-term direction of the U.S. dollar—and potentially gold as well.
Gold prices reached a fresh one-week high during the first half of the European trading session on Wednesday, with bullish traders eyeing a recovery toward the $5,100 per ounce level amid strong fundamental support.
Concerns over escalating tensions between the United States and Iran resurfaced after reports late last night indicated that the U.S. had shot down an Iranian drone in the Arabian Sea. This development pushed investors toward traditional safe-haven assets, benefiting the precious metal.
The upward momentum has also been reinforced by expectations of U.S. interest rate cuts, which have limited the recent rebound of the U.S. dollar from a four-year low and continued to support gold—an asset that yields no interest—for the second day in a row.
Traders are now awaiting the U.S. ADP employment report and the Institute for Supply Management (ISM) services PMI for further market direction.
A spokesperson for U.S. Central Command stated on Monday that a U.S. Navy fighter jet shot down an Iranian drone in self-defense after it approached the aircraft carrier USS Abraham Lincoln in the Arabian Sea. This incident undermined optimism surrounding the upcoming U.S.-Iran nuclear talks scheduled for later this week on Friday and contributed to gold recording its largest daily gain since November 2008.
The nomination of Kevin Warsh by U.S. President Donald Trump as Chairman of the Federal Reserve sparked speculation that the central bank may be less accommodative than previously expected. Nevertheless, traders continue to anticipate two additional interest rate cuts by the Federal Reserve this year, keeping the U.S. dollar on the defensive and supporting gold prices for the second consecutive day.
Meanwhile, Federal Reserve Governor Steven Miran stated on Tuesday that core inflation is not a major concern and that the U.S. central bank needs to cut interest rates by about one percentage point this year. Separately, Richmond Fed President Thomas Barkin said inflation remains above the target level but is expected to make further progress, noting that the U.S. economy continues to show notable resilience.
On the political front, President Trump signed a bill on Tuesday to restore funding for defense, healthcare, labor, education, housing, and other agencies, while temporarily extending funding for the Department of Homeland Security through February 13. The legislation ended the partial U.S. government shutdown and gave lawmakers additional time to negotiate potential restrictions related to the administration’s strict immigration agenda.
The closely watched U.S. nonfarm payrolls report for January will not be released on Friday as scheduled. However, the ADP private-sector employment report due on Wednesday is expected to provide fresh insight into labor market conditions. In addition, the ISM services PMI could influence demand for the U.S. dollar and provide further support for gold prices.
A report by OCBC Bank indicated that gold and silver prices have rebounded due to increased buying on dips, as liquidation pressures have eased. However, sentiment remains cautious, with the report expecting price stabilization rather than a trend reversal.
OCBC reiterated its year-end forecasts for gold and silver at $5,600 per ounce and $133 per ounce, respectively, noting that while trading positions have been partially reset, confidence has not yet fully returned, pointing to a potential period of volatile trading ahead.
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