Gold prices in the local market saw a slight decline in July, with the precious metal losing around 100 EGP per gram. This drop occurred amid increasing volatility in global markets and strong expectations of a possible interest rate cut by the U.S. Federal Reserve. Despite these monthly losses, gold markets showed clear signs of recovery in the last week of July, supported by a weakening U.S. dollar and weak economic data that increased demand for gold as a safe haven.
Gold prices stabilized during today’s trading, with the price of 21-karat gold reaching 4600 EGP per gram, compared to the close of the previous day. Meanwhile, the price of one ounce rose by about 26 USD to record 3363 USD during the week ending last Friday.
Additionally, the price of 24-karat gold reached 5257 EGP, 18-karat gold recorded 3943 EGP, and 14-karat gold hit 3067 EGP. The price of the gold pound was approximately 36,800 EGP.
On Friday, gold prices ended the day with a local rise of 80 EGP, as 21-karat gold opened at 4520 EGP and closed at 4600 EGP. Meanwhile, the price of one ounce rose from 3291 to 3363 USD.
Gold Prices in July: A Brief Overview
The price of 21-karat gold opened July trading at 4620 EGP per gram and closed at 4520 EGP. At the same time, the price of one ounce on the global market decreased, opening at 3308 USD and closing at 3291 USD.
Support for Gold from Weakened U.S. Economy
The markets were affected by comments from U.S. Federal Reserve Chairman Jerome Powell, who mentioned that no final decision had been made regarding an interest rate cut in September. This led to a drop in gold prices to their lowest level in four weeks. However, the market quickly recovered, supported by disappointing U.S. job data, which showed the U.S. economy added only 73,000 jobs last month. This reduced market confidence and pushed investors to turn to gold once again.
Expectations for Further Monetary Easing
By the end of the week, the probability of an interest rate cut in September had risen to 92%, according to CME FedWatch, opening the door for gold to break through the 3400 USD per ounce level. Experts predict that speculative flows and increased demand for safe-haven assets will drive gold prices above this level, especially amidst global trade tensions and weak U.S. data that could accelerate monetary easing.
Rising Investment Demand
Global reports show a significant increase in demand for gold from investors. According to the latest report from the World Gold Council, demand for gold-backed exchange-traded funds (ETFs) reached its highest level since 2020, reflecting the growing interest in gold as a tool for wealth preservation amidst economic uncertainty.
Trade Tensions Support Gold
As for trade tensions, the United States imposed high tariffs on imports from certain countries on August 1, further strengthening gold's role as a global currency asset. As central bank reserves shift from the U.S. dollar to gold, analysts expect this trend to continue in the coming period, supporting gold's status as a safe haven in emerging markets.
Markets are now awaiting next week's data, including the Services Purchasing Managers' Index (PMI) on Tuesday, the U.S. 10-year Treasury bond auction on Wednesday, the Bank of England's monetary policy decision, and the U.S. weekly unemployment claims data on Thursday.
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