The price of gold on Wednesday fell by LE2 per gram in conjunction with the rise in the price of the US dollar, after the Central Bank of Egypt rose the interest rate 200 basis points on Thursday.
Gold prices on Wednesday in Egypt:
- The 24-karat gold recorded LE1,406 per gram
- The 21-karat gold recorded LE1,210 per gram
- The 18-karat gold recorded LE1,060 per gram
- The 14-carat gold recorded LE700 per gram
- The price of the gold pound recorded LE9,840.
Gold Price Forecast
Gold experts and jewelers expected that the price of gold will witness a noticeable rise after the rise in the price of the US dollar in the black market, while gold is now also witnessing a rise at the global level.
On the global market, the price of gold rose, Wednesday, in futures contracts, to record US$1856.55, up by 0.54 percent, while the spot contracts for gold rose to record $1655.30, up by 0.46 percent.
Improvement by 2023
The outlook for gold could improve early next year as tight financial conditions begin to seep through the real economy, adding to downside risks for both the US and the global economy.
Monetary policy operates with a long and variable lag, indicating that the full negative impact of the Fed’s raising cycle is not yet being felt.
When the adverse effects begin to become more evident before the end of the quarter, defensive assets could benefit, buoyed in part by safe haven flows.
Investors and traders looking to the future will begin to take a pessimistic pivot position when the headwinds of a recession become too strong to be ignored, slowly lowering long-term bond yields, which generally reflect expectations for growth and inflation.
And when these events begin, the price of gold could stabilize and make a more permanent recovery in the early stages of 2023.