Gold prices stabilize locally as global prices edge lower after record highs

Gold prices recorded a state of relative stability in local and global markets during Wednesday’s trading, while bullion pared some of its gains on the international exchange after touching record levels above $4,500 per ounce. The move was driven by escalating geopolitical tensions and growing expectations that the U.S. Federal Reserve will continue cutting interest rates, according to a report by the Ai Sagha platform.

Saeed Embabi, Executive Director of Ai Sagha, said the local market is witnessing relative calm in price movements, with 21-karat gold trading at around EGP 5,980 per gram. Meanwhile, global gold prices retreated from an all-time high of $4,526 per ounce early in the session to stabilize near $4,490.

He added that 24-karat gold reached about EGP 6,840 per gram, while 18-karat gold recorded nearly EGP 5,130. The gold pound stood at approximately EGP 47,880.

Globally, gold prices saw a slight pullback following a strong rally, amid sharp volatility during Asian trading hours and reduced liquidity associated with the holiday season, encouraging some investors to take modest profits at elevated levels.

This year’s historic surge in gold prices has been exceptional by all measures, with gains exceeding 70% since the start of the year, putting the metal on track for its strongest annual performance since 1979. The rally has been supported by rising demand for safe-haven assets amid persistent geopolitical risks and economic uncertainty, alongside strong institutional and investment inflows.

Gold’s gains have also been bolstered by a weaker U.S. dollar, influenced by U.S. President Donald Trump’s protectionist trade rhetoric, in addition to the accommodative monetary policy pursued by the Federal Reserve.

The Federal Reserve has cut interest rates by a cumulative 75 basis points during 2025, and markets are pricing in two additional rate cuts next year. Lower interest rates continue to support gold’s appeal by reducing the opportunity cost of holding non-yielding assets.

Despite the possibility of some near-term pressure due to a lack of fresh catalysts and year-end profit-taking, the broader bullish trend remains intact, with expectations that the positive trajectory could extend into 2026.

On the economic front, the preliminary estimate of U.S. gross domestic product for the third quarter showed the economy growing at an annualized rate of 4.3%, exceeding previous estimates and market expectations, despite delays in the data release caused by the recent government shutdown.

However, these positive figures were mixed with weaker U.S. economic indicators elsewhere. Durable goods orders fell by 2.2% in October, industrial production declined by 0.1% before posting a modest recovery in November, and the Conference Board’s consumer confidence index dropped to 89.1 in December, keeping pressure on the U.S. dollar.

The U.S. dollar index, which measures the greenback against a basket of six major currencies, is trading around 97.87, hovering near its lowest level since early October.

Regarding monetary policy, markets broadly expect the Federal Reserve to keep interest rates unchanged at its upcoming January meeting. Fed Chair Jerome Powell has stated that the central bank is “in a good position to wait and see” how economic conditions evolve. CME FedWatch shows only a low probability of a rate cut in January, with expectations that monetary easing could resume later in the year amid slowing inflation and cooling labor market conditions.

Geopolitical tensions remain a key source of market pressure, as the Russia–Ukraine conflict persists, instability continues in the Middle East, and tensions between the United States and Venezuela escalate—factors that continue to reinforce gold’s role as a safe-haven asset.