Gold Prices Rise Locally to EGP 7,500 per Gram Amid Escalating Middle East Tensions

Gold prices rose in Egypt’s local markets during Thursday’s trading, alongside a slight increase in global markets, driven by escalating geopolitical tensions in the Middle East that boosted demand for the precious metal as a safe-haven asset, according to a report released by the iSagha platform.

Saeed Embabi, CEO of iSagha, said that gold prices in the local market increased by around EGP 45 during today’s trading, bringing the price of 21-karat gold to approximately EGP 7,500 per gram.

He added that the price of 24-karat gold reached about EGP 8,571 per gram, while 18-karat gold recorded around EGP 6,429 per gram. Meanwhile, the gold pound coin climbed to nearly EGP 60,000.

Globally, gold prices saw a modest increase, with the ounce rising by about $3 to reach $5,180, as investors turned to gold as a hedge against geopolitical risks, although prices remained below the $5,200 level.

The uptick comes amid continued military escalation in the Middle East, which has kept demand for safe-haven assets elevated. Reduced momentum in U.S. dollar buying also provided additional support for gold prices, although gains remain limited.

However, concerns over persistent inflation have capped further advances in gold. Expectations for Federal Reserve interest rate cuts have weakened as U.S. Treasury yields continue to rise, strengthening the U.S. dollar and putting pressure on the precious metal.

Fears over energy supply disruptions intensified following reports that two oil tankers were attacked in the northern Arabian Gulf near Iraq and Kuwait. The incident pushed crude oil prices higher by more than 6%, raising concerns about renewed inflationary pressures.

In this context, Kristalina Georgieva, Managing Director of the International Monetary Fund, warned that a sustained 10% increase in oil prices over a full year could raise global inflation by around 40 basis points.

Such a scenario could force the U.S. Federal Reserve to delay interest rate cuts for a longer period, potentially pushing U.S. Treasury yields even higher—an outcome that would likely strengthen the dollar and limit further gains in gold.

Investors are now awaiting the release of U.S. weekly initial jobless claims later today, ahead of Friday’s Personal Consumption Expenditures (PCE) price index report, the Federal Reserve’s preferred gauge of inflation.

On the economic data front, the U.S. Bureau of Labor Statistics reported on Wednesday that the Consumer Price Index rose by 0.3% in February, following a 0.2% increase in January, in line with economists’ expectations.

Annual inflation held steady at 2.4%, unchanged from January and matching forecasts.

Core inflation, which excludes volatile food and energy prices, increased by 0.2% in February, bringing the annual core inflation rate to 2.5% for the third consecutive month.

Housing costs continued to be the largest contributor to inflationary pressures, with the shelter index rising by 0.2% in February, while the food index increased by 0.4% and the energy index climbed by 0.6%.

Despite recent volatility, gold remains up roughly 20% since the start of the year, supported by its role as a safe-haven asset amid global geopolitical uncertainty, although the pace of gains has slowed since the outbreak of the conflict on February 28.