The World Gold Council announced on Tuesday that the volume of gold purchases by Egyptians during the second quarter (Q2) of 2024 reached 14.4 tonnes, a decrease of 16% compared to the Q2 of 2023, which recorded total purchases of 17.1 tonnes. However, it remains better than the purchases in the Q1 of the current year, which were 13.2 tonnes of gold.
The council added that Egyptians’ purchases of gold jewellery during the second quarter of the year reached 6.8 tonnes, an increase of 2% compared to the Q2 of 2023, which recorded purchases of 6.7 tonnes, but lower than the Q1 of 2024, which recorded 8 tonnes.
The World Gold Council noted that purchases of gold bars and coins in Egypt during the Q2 of 2024 amounted to 7.6 tons, a decrease of 27% compared to the second quarter of 2023, which saw purchases of 10.4 tonnes. Meanwhile, purchases of gold bars and coins in the first quarter of this year were 5.2 tonnes.
The World Gold Council indicated that the decline in demand for gold jewellery was almost universal across the Middle East due to record high gold prices, with demand for gold jewellery from the Middle East falling below 40 tons for the first time since the second quarter of 2021.
However, the World Gold Council exempted Egypt from this decline in demand for gold jewellery, noting that the IMF rescue package helped boost sentiment, which contributed to a notable increase in demand for jewellery during Eid al-Adha.
In its commentary on the World Gold Council data, Gold Bullion attributed the decline in demand for gold bars and coins in Egypt during the second quarter to the improvement and stabilisation of the Egyptian pound following the Central Bank of Egypt’s (CBE) decisions to liberalise the exchange rate on March 6, which contributed to halting speculation on gold.
Gold Bullion’s analysis added that there has been a decline in hedging activities and a reduction in demand for gold as a safe haven in Egypt in recent months. This followed the cessation of the continuous rise in the dollar’s price and the elimination of the parallel dollar market, which helped reduce demand for gold in Egypt.
