Gold rises locally and globally as bond yields fall after Powell’s remarks

Gold prices rose in local markets and on the global exchange during Tuesday’s trading, supported by a decline in U.S. Treasury yields following comments from Federal Reserve Chair Jerome Powell, who eased expectations of an immediate interest rate hike and confirmed that inflation pressures remain “stable” despite rising energy prices, according to a report released by the iSagha platform.

Saeed Embabi, CEO of the iSagha platform, said that gold prices in the Egyptian market increased by about EGP 125 during Tuesday’s trading compared to Monday’s close, with 21-karat gold reaching EGP 7,175 per gram, while the global ounce rose by about $59 to $4,577.

He added that 24-karat gold recorded around EGP 8,200 per gram, 18-karat gold reached about EGP 6,150 per gram, and the gold pound recorded approximately EGP 57,400.

Globally, gold maintained a moderate upward trend on Tuesday, continuing its recovery from last week’s lows near $4,100, although resistance around $4,600 is still limiting further upward movement for now.

Despite this recovery, gold prices are still heading toward their worst monthly performance since 2008, amid the ongoing impact of the U.S.–Iran war, which has now entered its fifth week, and its influence on energy markets, inflation expectations, and global monetary policy.

Gold has drawn some support from falling U.S. Treasury yields after Powell’s comments; however, improved risk appetite in financial markets limited gains, especially after reports indicated that U.S. President Donald Trump told his aides he is prepared to end the war soon even if the Strait of Hormuz remains largely closed, which helped European equities rise while the U.S. dollar remained below key resistance levels.

At the same time, rising oil and gas prices due to the Middle East conflict have increased global inflation expectations, strengthening the likelihood that interest rates will remain higher for longer, which in turn puts pressure on gold prices.

Spot gold is currently on track for a monthly decline of about 14.6%, marking the largest monthly drop since October 2008 during the global financial crisis.

Wayne Notteland, investment director at Shackleton Advisors, said that the way gold is traded has changed over the past four years. He explained that before the Ukraine war, gold typically moved inversely to real bond yields and the U.S. dollar—rising when those indicators fell and declining when they rose.

He added that this relationship changed during 2025 and early 2026 when gold surged far beyond what historical relationships would suggest, but after the Iran war, gold returned to its traditional inverse relationship with the dollar and bond yields, which contributed to the recent decline.

He noted that gold’s decline may also have been amplified by strong gains earlier in 2026, which encouraged investors to take profits and liquidate positions, especially as market volatility has risen to roughly twice its historical average due to increased participation from financial investors.

He explained that central banks were the main driver of the gold bull market in recent years through reserve diversification away from the U.S. dollar, but the market later saw broad profit-taking as the dollar strengthened and market uncertainty increased.

He compared the current situation to 2008, when heavy investment in commodities amplified price movements before markets declined as the financial crisis deepened and the dollar strengthened, with gold falling alongside other commodities such as oil and copper.

He believes that the market this year has once again revealed a key investor weakness: overinvestment in gold as the last remaining safe haven.

Regarding future outlook, Goldman Sachs analysts maintained their bullish outlook for gold despite recent selling pressure, expecting prices to reach around $5,400 per ounce by the end of 2026, supported by continued central bank buying, a normalization of speculative positioning, and a potential U.S. interest rate cut of about 50 basis points.

They added that near-term risks remain tilted to the downside, particularly if disruptions in the Strait of Hormuz continue, which could trigger further liquidation in gold positions. However, medium-term risks are tilted to the upside if geopolitical tensions accelerate global diversification into gold and negatively impact confidence in Western fiscal sustainability.