Gold prices rose locally amid escalating tensions between the US and Israel over Iran, coinciding with the closure of global stock markets.
This prompted some traders to be cautious in their sales and reduce their supply, anticipating a potential price surge upon the reopening of markets.
The Vice President of the Gold and Jewelry Division at the Federation of Egyptian Chambers of Commerce (FEDCOC), Lotfy al-Mounib, said that gold prices in the local market saw a noticeable increase.
He explained that this was due to some wholesalers’ reluctance to sell while global stock markets were closed following the US-Israeli strike on Iran.
This led to price fluctuations, even as the price of an ounce of gold remained stable globally at around $5,280.
Mounib added that the price of 21-karat gold rose to LE 7,250, compared to LE 7,100 at the close of trading on Friday, amidst the prevailing market anticipation of the resumption of global trading.
Tensions drive up prices
He noted that geopolitical tensions typically drive prices up, as capital tends to flow out of productive and commercial investments and into gold as a safe haven during times of war and uncertainty, thus increasing demand and raising prices.
Mounib added that the extent of the impact remains contingent on the nature of the Iranian response, the scope of the escalation, and the duration of the conflict.
The former head of the Gold and Jewelry Division at FEDCOC, Wasfi Amin, said that gold prices, along with all precious metals such as silver and platinum, will be significantly impacted both locally and globally in the coming days as global stock exchanges reopen, due to the US-Israeli military campaign against Iran.
Amin explained that the price of an ounce of gold internationally could rise by approximately $500 in the coming days, which could translate to an increase of around LE 700 per gram in the local market.
Edited translation from Al-Masry Al-Youm
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