Gold rises locally and globally ahead of Fed minutes release

Gold prices climbed in the local market and on the global exchange during Wednesday’s trading, supported by relatively stronger demand and investor anticipation of the U.S. Federal Reserve’s January meeting minutes due later today, according to a report by the “iSagha” platform.

Engineer Saeed Embaby, CEO of the platform, said 21-karat gold rose by EGP 115 to EGP 6,640 per gram, while the global ounce increased by $123 to reach $5,004.

The price of 24-karat gold recorded EGP 7,589 per gram, 18-karat gold stood at EGP 5,691, and the gold pound coin reached approximately EGP 53,120.

Globally, gold rebounded after falling to a nearly two-week low of $4,842 in the previous session, as buyers stepped in to take advantage of lower prices, limiting losses. Despite this recovery, short-term expectations have shifted slightly bearish, as changing macroeconomic factors and weaker technical indicators continue to cap upward momentum.

Prices held near session highs after data showed stronger-than-expected improvement in the U.S. housing market during November and December. The U.S. Department of Commerce reported that housing starts rose 3.9% in November to a seasonally adjusted annual rate of 1.322 million units, exceeding forecasts of 1.270 million units, compared with 1.246 million in October. Starts also increased in December to 1.448 million units, above expectations of 1.400 million.

Building permits, a leading indicator of future construction, declined 1.6% in November to 1.388 million, though still above expectations of 1.360 million. In December, permits reached 1.448 million versus forecasts of 1.400 million.

The U.S. housing sector is a key contributor to GDP but has faced significant pressure from persistently high home prices and elevated mortgage rates, a consequence of the Federal Reserve’s aggressive tightening cycle, which has pushed many prospective buyers out of the market.

Meanwhile, easing geopolitical risks and a stronger U.S. dollar have limited gold’s upside. Signs of progress in nuclear talks between the United States and Iran in Geneva, along with ongoing U.S. efforts to end the Russia–Ukraine war, have reduced safe-haven demand for the precious metal.

Strong U.S. labor market data have also dampened expectations of an imminent rate cut, although slowing inflation has kept hopes alive for monetary easing in the second half of the year.

Federal Reserve Governor Michael Barr stated that borrowing costs should remain unchanged for some time until clearer evidence emerges that inflation is moving toward the 2% target. At the same time, Chicago Fed President Austan Goolsbee said further rate cuts could be possible this year if inflation continues to decline.

Earlier data showed U.S. durable goods orders fell 1.4% in December, less than the expected 2.0% decline, following a sharp 5.4% increase in November. Excluding transportation, orders rose 0.9%, compared with 0.5% previously.

Investor focus now turns to U.S. industrial production data for January and the minutes of the Federal Open Market Committee meeting held on January 27–28, scheduled for release at 9:00 p.m. Cairo time, for further clues on the policy outlook.

The Federal Reserve kept interest rates unchanged within a 3.50%–3.75% range after three consecutive 25-basis-point cuts. In its statement, the central bank reiterated its commitment to monitoring risks to both sides of its dual mandate.

On Friday, markets will also watch the advance estimate of fourth-quarter U.S. GDP and the core Personal Consumption Expenditures (PCE) price index for additional guidance on the Fed’s policy path, which could help determine gold’s next direction.

Overall, the broader bullish trend in gold remains intact, with the current price action seen as a consolidation phase rather than a structural shift in the underlying upward momentum, as macroeconomic and geopolitical factors continue to provide support.