Gold prices in Egypt’s local market declined by EGP 150, or 2.2%, over the past week, even as global gold prices posted gains, reflecting a correction driven by a narrowing pricing gap between local and international markets.
According to a report issued by online gold and jewellery trading platform iSagha, international gold prices rose by around $70, or 1.4%, to approximately $4,965 per ounce. The increase was supported by weaker-than-expected US economic data, which reinforced market expectations that the Federal Reserve may move towards monetary easing.
Saeed Embabi, Chief Executive Officer of iSagha, said 21-carat gold closed the week at EGP 6,675 per gram, while 24-carat gold reached approximately EGP 7,629 per gram. Eighteen-carat gold was priced at EGP 5,721 per gram, and the gold pound stood at around EGP 53,400.
Embabi explained that the decline in local prices occurred despite the global uptrend due to a pricing premium in the domestic market of between EGP 300 and EGP 500 above international levels. This premium had built up as traders hedged against sharp price volatility, leading to a subsequent local correction as risk levels eased.
On the global front, gold began the week trading more steadily following sharp declines last week, positioning itself for solid weekly gains as buyers re-entered the market at lower price levels.
Friday’s trading session was marked by sharp price swings, with gold falling to a three-day low of $4,655 per ounce before quickly recovering and climbing back toward $4,950. The rebound was supported by weak US labour market data, which revived expectations of monetary easing.
Analysts said the current volatility does not signal a negative shift in gold’s broader trend, but rather represents a natural corrective move and a reduction in excessive speculative positioning. This follows an exceptional rally during which gold recorded more than 12 record highs within a few weeks, while silver prices reached levels described as overextended.
Despite recent fluctuations, underlying demand for gold remains strong. Analysts pointed to continued central bank purchases at historically high levels, alongside robust physical demand in major markets such as India and China. Gold allocations within investment portfolios also remain relatively low, leaving room for increased institutional participation.
Major banks continue to forecast gold prices approaching $6,000 per ounce by the end of the year, citing long-term structural factors including rising sovereign debt, widening fiscal imbalances, geopolitical risks, and the gradual weakening of the US dollar.
