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hamdy Abdelrashid 

 Egypt The Gold and Precious Metals Division at the Federation of Egyptian Industries (FEI), headed by Ehab Wassef, has released a comprehensive report on the latest developments in the local and global gold markets. The report confirmed that gold prices in Egypt experienced a notable decline during last week's trading, driven by a sharp drop in global gold prices and the stability of the US Dollar against the Egyptian Pound.

According to the report, the price of 21-karat gold—the most traded in the Egyptian market—fell by 4.8% last week. The carat opened trading at 6,775 EGP per gram but closed the week at a low of 6,450 EGP per gram.

The Division attributed this local decline primarily to the significant drop in global gold per ounce, coupled with the stabilization of the USD exchange rate near the 52 EGP mark. This currency stability effectively shielded the local market from any additional pricing pressures.

Macroeconomic Stability in Egypt Improved foreign exchange indicators in Egypt played a crucial role in calming the local market. Key data points include:

Foreign Assets: The Central Bank of Egypt (CBE) reported a $1.56 billion surge in net foreign assets during April, reaching $22.89 billion.

Expat Remittances: Remittances from Egyptians abroad saw a robust year-on-year increase of 61.8% in March, totaling $5.5 billion.

Wassef emphasized that these diverse foreign currency inflows positively impacted the market, curbing random price fluctuations and sudden spikes in local gold pricing.

Global Pressures: US Employment and Fed Policy On the global front, the report highlighted that recent US employment data exerted heavy downward pressure on gold. The data reinforced market expectations that the US Federal Reserve will maintain a tight monetary policy, reducing the likelihood of near-term interest rate cuts.

US wage growth, resting at 3.4%, reignited inflation fears. Because the Fed views wage inflation as one of the most stubborn forms of inflation, this metric drove US Treasury yields higher, negatively impacting non-yielding assets like gold.

Market Dynamics and Future Targets Technically, heavy selling momentum pushed global gold prices below the 200-day Exponential Moving Average (EMA) near $4,380 per ounce. Locally, this translated to 21-karat gold breaking the 6,500 EGP barrier to settle near a temporary support level of 6,450 EGP.

Despite these price drops, physical demand remains remarkably strong. Data from the Chicago Mercantile Exchange (CME) revealed a simultaneous decline in both registered and eligible gold inventories, indicating real physical withdrawals from vaults rather than mere internal transfers.

Looking ahead, the Division noted that the $4,200 to $4,050 range serves as a major global support zone. Long-term targets remain bullish at $5,000, $5,500, and eventually $6,000 per ounce, underpinned by ongoing geopolitical tensions and persistent global inflationary pressures.