Slight Decline in Local Gold Prices as Markets Await U.S. Data and
Gold prices in the local market recorded a slight drop during Thursday's trading, pressured by a modest decline in global spot prices as the U.S. dollar saw a mild rebound. The market is on edge ahead of the U.S.-Russia summit scheduled for tomorrow in Alaska.
Local gold prices fell by about EGP 5 compared to Wednesday's close, with 21-karat gold now trading at EGP 4,570 per gram. Globally, spot gold slipped $4 to $3,355 an ounce. In other categories, 24-karat gold stood at EGP 5,223, 18-karat at EGP 3,917, and 14-karat at EGP 3,047, while the gold pound coin was priced at EGP 36,560.
On Wednesday, prices remained relatively steady, with 21-karat gold opening and closing at EGP 4,575 per gram, while spot gold rose $11 from $3,348 to $3,359.
Market Drivers
Gold is currently trading in a tight range near $3,355 per ounce, as a stable U.S. dollar limits its upside. Market sentiment remains fragile ahead of the U.S.-Russia summit, following U.S. President Donald Trump's warning of 'very severe consequences' if Russia does not end the war in Ukraine, according to CNN.
Analysts are divided: some see the talks as a chance to ease tensions, while others fear a failure could escalate geopolitical risks, spurring safe-haven flows into gold.
Focus on U.S. Economic Data
Investors are awaiting U.S. weekly jobless claims and July's Producer Price Index (PPI) data for clues on the Federal Reserve's policy direction.
U.S. Treasury yields fell for the second consecutive day, with the 10-year yield dropping to 4.213% and the 30-year yield to 4.803%, amid rising expectations of rate cuts. According to CME's FedWatch tool, markets are now fully pricing in a 25-basis-point cut in September, compared to about 60% odds a few weeks ago, with additional cuts likely in October and December.
Federal Reserve Commentary
U.S. Treasury Secretary Scott Bessent said the Fed should cut rates by 150–175 basis points, calling for an immediate 50-basis-point reduction in September.
In contrast, Fed member Austan Goolsbee stressed that rate cuts require several months of favorable inflation data, while Raphael Bostic said the central bank has the 'luxury of waiting' and expects only one cut in 2025.
Data Expectations
Initial jobless claims are forecast to rise to 228,000 from 226,000 the previous week, with continuing claims steady at 1.96 million. PPI is expected to increase by 0.2% month-on-month and 2.5% year-on-year, while the core PPI is seen up 0.2% monthly and 2.9% annually.
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