The prices of gold continued their hike in the local market on Tuesday, supported by the precious metal’s commensurate rise in global markets.
Ehab Wasef, Deputy Head of the Gold Division at the Federation of Egyptian Chambers of Commerce (FEDCOC), said that gold prices rose by about EGP 9. The price of 24-carat gold now stands at about EGP 1,006.85, while 21-carat recorded about EGP 881, and 18-carat at about EGP 755.15.
Wasef said that the price of the bullion coin rose by about EGP 72 to EGP 7,048, with the global price of one ounce of gold reaching $1,977.
Ragab Hamid, CEO of Sabayik Al-Kuwait, announced that the gram of raw gold continued to rise, reaching EGP 1,004 for the first time ever in the Egyptian market. He noted that there has been a growth in the purchase of raw gold and alloys in the local market, despite the high prices.
In its weekly report, Sabayik Al-Kuwait said that the demand for gold in recent weeks has pushed the ounce to a new record of $1,990. The report attributed this to customers who lack the appetite for risk seeing gold as a safe haven.
The report added that the precious metal achieved gains of about 31% in July 2020, which is the highest monthly gain achieved by gold since 2016. The significant gains have come on the back of the ongoing novel coronavirus (COVID-19) pandemic and its effects on world economies. Gold prices have also been affected by the ongoing tension in trade and political relations between the US and China.
Hamid said there are several factors that have contributed to the rise in gold, including the decline in the value of the US dollar. The resumption of European market activity through stimulus programmes and the decline in the value of bonds and stocks have also impacted gold prices. The announcement by the US Federal Reserve that interest rates will remain unchanged had the greatest impact on the US dollar rising to a new high.
Hamid pointed out that gold has achieved gains of over 49% since the beginning of 2019, pointing to the disappearance of regular corrections trend of gold prices due to the investor need for safe havens.