Local Gold Prices Jump as Ounce Posts Weekly Gains Amid Rising Geopolitical Tensions

Gold prices in the local market rose during Saturday trading, coinciding with the global market weekend closure, after the ounce recorded weekly gains of 1.3%, driven by escalating geopolitical tensions and renewed safe-haven demand, according to a report released by the iSagha platform.

Eng. Saeed Embabi, CEO of the platform, said that 21-karat gold climbed by EGP 100 to reach EGP 6,960 per gram. Meanwhile, the global ounce gained about $65 over the week to trade near $5,108.

The price of 24-karat gold recorded EGP 7,954 per gram, while 18-karat gold stood at EGP 5,966. The gold pound coin reached approximately EGP 55,680.

U.S. Data Fuel Market Volatility

Gold rose more than 1% on Friday after data showed a slowdown in U.S. economic growth, while Core Personal Consumption Expenditures (PCE) inflation exceeded 3%, the Federal Reserve’s preferred inflation gauge.

The U.S. Supreme Court ruled against tariffs imposed under national emergency powers, improving risk appetite and pushing U.S. equities to reverse earlier losses and trade higher during the session.

Meanwhile, the U.S. Dollar Index fell 0.11% to hover around 97.70. However, U.S. Treasury yields recovered, with the 10-year yield rising one basis point to 4.081%, limiting further upside for gold.

U.S. President Donald Trump described the Supreme Court’s decision as “disappointing,” but confirmed that national security-related tariffs under Sections 232 and 301 will remain in place. He also indicated plans to impose a universal 10% tariff under Section 122, in addition to other duties.

Slower Growth and Weaker Consumer Sentiment

U.S. GDP growth slowed to 1.4% year-on-year from 4.4%, partly attributed to the 43-day government shutdown.

The University of Michigan consumer sentiment index declined from 57.3 to 56.6, with households reporting that rising prices are straining their personal finances. One-year inflation expectations eased from 4% to 3.4%, while five-year expectations remained steady at 3.3%.

Markets continue to price in two 25-basis-point rate cuts by the Federal Reserve this year, amid speculation over future leadership at the central bank and its potential policy direction.

Central Bank Buying Supports Long-Term Outlook

Goldman Sachs stated that the recent slowdown in global central bank gold purchases is a “temporary phenomenon” caused by sharp price volatility, stressing that the broader structural trend still points to strong demand for strategic gold reserves.

The bank highlighted a significant structural gap between current gold allocations in emerging market central bank reserves and targeted levels, suggesting substantial liquidity inflows once volatility subsides. It forecasts gold could reach $5,400 per ounce by the end of 2026, supported by institutional demand and renewed retail investor participation, particularly if U.S. rate cuts materialize.

Analysts at JPMorgan argued that while there are theoretical factors that could challenge gold’s rally — notably a potential slowdown in central bank purchases — these risks are insufficient to reverse the broader upward trend.

They noted that central banks have been the primary driver of gold’s surge, with net purchases doubling since the outbreak of the Russia–Ukraine war in 2022, as countries diversified reserves away from the U.S. dollar following the freezing of Russian assets.

Gold currently accounts for about 19% of reserves in emerging markets, compared to roughly 47% in advanced economies, indicating room for further accumulation.

Russia’s Gold Holdings Adjustment

Russia’s central bank reduced its gold holdings by 300,000 ounces in January to 74.5 million ounces — the first decline since October — taking advantage of record-high prices that surpassed $5,600 per ounce last month.

Despite the sale, the total value of Russia’s gold reserves rose by 23% in January to $402.7 billion, supported by higher global prices.

Gold remains underpinned by geopolitical uncertainty, slower U.S. growth, and ongoing central bank diversification strategies, while movements in the U.S. dollar and Treasury yields are expected to remain key drivers of price direction in the near term.