The local gold price in Egypt is unstable, with inconsistent pricing and trading, according to a Gold Bullion report. The shops are worried about their gold reserves and the lack of a clear price for buying or selling.
The average price in the market is around EGP 3,950 per 21K gram, but there is no agreement on the price for trading.
Gold Bullion said that the trading of gold bullion and coins has almost stopped, while the gold jewelry is still selling. This is because the traders can hedge the workmanship price on the jewelry, but not on the bullion and coins.
Meanwhile, the dollar price in the parallel market is at a record high, which shows the growing concerns about the future of the economy. This affects the gold price, which is based on the dollar price in the parallel market.
The cash flow for the 25% certificates is almost over, as it went to the 27% certificates and the buying of gold and dollars from the parallel market. These are the tools that the citizens use to hedge against inflation and the decline in the currency value, as well as the expectations of a floatation in the exchange rate.
The gold price in Egypt may need a negative correction, after rising significantly since the start of the year without a proper negative adjustment. But the general trend of trading is still upward, due to the ongoing economic uncertainty. The supply of gold is also weak, due to the halt of imports and the low selling of gold by the citizens who want to hedge against inflation with gold.
Gold prices rose globally for the second day in a row, reaching the highest level in more than a week. But gold prices are still within a specific range, as the markets wait for the results of the Federal Reserve meeting and the US labor data this week.
The international spot price of an ounce of gold rose by 0.1% on Tuesday, reaching the highest level in more than a week at $2040 per ounce. The price is now trading at $2035 per ounce.
The price of gold has increased by 0.8% since the beginning of the week, after getting support from the higher demand for safe havens in the financial markets. This was triggered by the killing and injuring of American soldiers on the Syrian border in an air strike, which raised the geopolitical risks in the Middle East region.
