New Surge in Gold Prices Driven by Escalating Geopolitical Tensions

Gold prices rose in local markets and on the global exchange during Monday’s trading, supported by escalating geopolitical tensions—particularly between the United States and Venezuela—which boosted demand for gold as a safe-haven asset, according to a report issued by the iSagha platform.

Said Embaby, Executive Director of iSagha, said that gold prices increased by around EGP 70 during today’s session, with the price of 21-karat gold reaching EGP 5,960 per gram, while gold prices on the global exchange jumped by about $111 to record $4,443 per ounce.

Embaby explained that the price of 24-karat gold stood at approximately EGP 6,812 per gram, while 18-karat gold recorded around EGP 5,109 per gram. The price of the gold pound rose to nearly EGP 47,680.

Gold prices had declined locally over the past week by EGP 185, representing a drop of 5%, while the global ounce lost about $201, or 4.4%.

Despite this weekly decline, gold achieved strong annual gains during 2025. Prices in the local market rose by about 56%, an increase of roughly EGP 2,090, while global prices climbed by 65%, gaining close to $1,694 per ounce.

The report noted that these gains were supported by several factors, most notably expectations of interest rate cuts, continued gold purchases by central banks, and rising concerns related to geopolitical tensions and global economic uncertainty.

On the geopolitical front, recent developments between the United States and Venezuela heightened market anxiety after the United States launched a large-scale military operation over the weekend, including air and ground strikes, which resulted in the arrest of Venezuelan President Nicolás Maduro and his wife, Cilia Flores.

U.S. President Donald Trump announced that the United States would temporarily assume control of Venezuela until arranging a “safe and orderly” transfer of power.

This escalation, alongside the ongoing Russia–Ukraine conflict, has kept gold prices supported near the record highs reached on December 26, when prices touched $4,555 per ounce.

The turbulent geopolitical landscape, together with the direction of U.S. Federal Reserve policy, remains a key focus for investors—especially amid international criticism surrounding recent developments in Venezuela and U.S. warnings directed at other countries in the region, in addition to renewed debate over geopolitical issues with strategic implications.

At the same time, gold prices received additional support from market expectations of further monetary easing by the Federal Reserve, as investors brace for a data-heavy week of influential U.S. economic releases.

Investors are closely watching today’s release of the ISM Manufacturing Purchasing Managers’ Index (PMI) for December, followed on Tuesday by the S&P Global Composite and Services PMIs.

Markets are also awaiting Wednesday’s ISM Services PMI and the Job Openings and Labor Turnover Survey (JOLTS), followed by weekly jobless claims data on Thursday, culminating with the U.S. Non-Farm Payrolls (NFP) report on Friday.

On the monetary policy front, markets are expecting two interest rate cuts this year, following cumulative cuts of 75 basis points in 2025. However, the Federal Reserve’s latest projections from the December meeting indicate only one rate cut in 2026.

Recent economic data showed that the U.S. economy recorded annual growth of 4.3% in the third quarter, while inflation showed signs of slowing, with the Consumer Price Index rising 2.7% year-on-year in November—opening the door for further monetary easing.

Anna Paulson, President of the Federal Reserve Bank of Philadelphia, said inflation is likely to continue easing and that the labor market remains relatively resilient, with expectations for U.S. economic growth of around 2% this year.

She added that the current level of interest rates remains relatively restrictive, noting that some limited policy adjustments may be appropriate later in the year.

According to the CME FedWatch Tool, markets widely expect the Federal Reserve to keep interest rates unchanged at its meeting scheduled for January 27–28, with a low probability of a rate cut estimated at 18.3%, while the likelihood of a cut rises to around 44% at the March meeting.