Gold prices in Egypt’s local markets increased by 2.8% during last week’s trading, while the global ounce price declined by about 3%, pressured by a stronger U.S. dollar and rising U.S. Treasury yields amid escalating geopolitical tensions in the Middle East, according to a report issued by the iSagha platform.
Saeed Embabi, CEO of the iSagha platform, said local gold prices rose by around 200 Egyptian pounds during the week. The price of 21-karat gold opened trading at EGP 7,225 per gram and closed at EGP 7,425.
Meanwhile, the global gold ounce declined by about $151 on international markets, starting the week at $5,172 and ending at around $5,021.
Embabi added that the price of 24-karat gold reached approximately EGP 8,486 per gram, while 18-karat gold recorded around EGP 6,364 per gram, and the gold pound coin reached roughly EGP 59,400.
He explained that the rise in the U.S. dollar exchange rate offset the impact of the decline in global gold prices on the local market during the week.
Embabi noted that gold pricing in the Egyptian market is primarily determined by three key factors: the global gold ounce price, the U.S. dollar exchange rate, and domestic supply and demand.
He also pointed out that the gap between local and global prices has nearly disappeared, indicating strong alignment between Egypt’s gold market and international prices.
Since the beginning of 2026, local gold prices have increased by about EGP 1,600, with 21-karat gold reaching around EGP 7,425 per gram during today’s trading, compared with EGP 5,840 at the end of last December, supported by the rise in global gold prices.
Globally, gold has gained about 16% since the start of 2026, trading near $5,021 per ounce, after the precious metal surged roughly 65% during 2025.
In contrast, Egyptian gold purchases declined by 10% last year to about 45.1 tonnes, as the sharp increase in global prices—up more than 64%—continued to weigh on demand, according to the World Gold Council’s Gold Demand Trends report.
Globally, gold prices fell by about 3% last week, marking the second consecutive weekly decline. The metal retreated after losing momentum following a rebound earlier in the week. While the drop was not as severe as the heavy sell-off seen at the end of January, it was still notable.
However, gold managed to hold above the $5,000 level. Much of the pressure came from rising oil prices, which pushed the U.S. dollar and bond yields higher.
This followed statements by Iran’s new supreme leader, Mojtaba Khamenei, who indicated that closing the Strait of Hormuz could remain a strategic option against adversaries and warned that additional fronts could be opened if the conflict escalates and national interests require it.
These remarks quickly reverberated across financial markets, pushing oil prices higher again and reinforcing upward pressure on bond yields and the U.S. dollar.
As a result, gold found itself caught between competing forces. Escalating geopolitical tensions provided some safe-haven support, while stronger yields and a stronger dollar weighed on investor sentiment.
Crude oil becomes the dominant market driver
Crude oil has once again emerged as the primary driver of global markets. Brent crude closed above $100 per barrel on Friday, and market indicators suggest prices could rise another 5% over the weekend as tensions in the Middle East continue to escalate.
The latest surge in oil prices weighed on equity markets toward the end of the week while the U.S. dollar continued to strengthen, creating a challenging environment for gold, which struggled to attract sustained buying interest despite rising geopolitical risks.
The sharp volatility in oil markets is not surprising. Traders are still attempting to determine the fair value of crude oil under the current conditions.
On one hand, significant volumes from emergency oil reserves have been released, while sanctions on some Russian oil shipments at sea have been temporarily eased in an attempt to calm supply concerns.
These measures followed the sharp spike in oil prices triggered by U.S.–Israeli strikes on Iran and the subsequent retaliatory attacks carried out by Tehran across the Gulf.
The attacks effectively disrupted shipping through the Strait of Hormuz, one of the most critical strategic waterways in the world. Roughly 20% of global oil supplies typically pass through this narrow corridor, and any disruption immediately raises concerns about global energy availability.
As a result, the halt of some oil tanker traffic intensified fears of supply shortages and drove oil prices sharply higher.
Gold outlook: Rising yields and dollar strength dominate safe-haven demand
The shock in the energy sector quickly spilled over into financial markets. Higher oil prices fueled inflation concerns, pushing bond yields higher and strengthening the U.S. dollar as traders reassessed interest-rate expectations.
Expectations for interest rate cuts have declined significantly, further reinforcing upward pressure on yields. Additionally, none of the major central bank meetings scheduled for next week are expected to deliver strongly dovish signals.
For gold, this creates a difficult environment. Rising yields typically weigh on non-yielding assets such as gold and silver, which do not generate income and carry storage costs.
In recent months, gold has shown remarkable resilience despite higher yields, but the situation has shifted over the past two weeks.
Nevertheless, safe-haven inflows have helped prevent a sharp decline in prices. The metal remains partially supported by the broader geopolitical backdrop, even as macroeconomic forces currently limit any strong upward momentum.
U.S. economic data also showed a slowdown in growth during the second half of 2025, with fourth-quarter GDP growth revised down to 0.7% from a previous estimate of 1.4%.
At the same time, the core Personal Consumption Expenditures (PCE) price index—the Federal Reserve’s preferred inflation gauge—held steady at 3.1% year-over-year in January, while the headline rate eased to 2.8%.
These developments are raising concerns that the U.S. economy could enter a period of stagflation, particularly as warnings grow that the conflict in the Middle East may create prolonged supply shocks that push inflation higher while weighing on economic growth.
Demand for liquidity pressures gold and silver
Gold and silver prices have faced a wave of selling over the past two weeks as investors shifted toward holding liquidity in U.S. dollars amid heightened uncertainty in global markets.
Although geopolitical tensions typically boost demand for safe-haven assets, the conflict involving the United States, Israel, and Iran has triggered exceptional demand for dollar liquidity, given its status as the world’s primary reserve currency.
Under such conditions, investors tend to favor the most liquid assets—even if that comes at the expense of gold in the short term.
A busy week ahead with major central bank meetings
Markets are closely watching a series of central bank meetings scheduled for next week, led by the U.S. Federal Reserve’s monetary policy decision.
The Reserve Bank of Australia will meet early in the week, followed by the Bank of Canada, while the Bank of Japan will also hold its policy meeting on the same day.
On Thursday, monetary policy decisions are expected from the Swiss National Bank, the Bank of England, and the European Central Bank, with most analysts anticipating that central banks will maintain their current policies without major changes.
Investors will also monitor key U.S. economic data releases, including industrial production figures, housing market indicators, and inflation and employment data, which could provide additional signals about the direction of the U.S. economy in the coming period.
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