Gold Holds Firm Amid U.S. Fiscal Uncertainty and Critical Market Expectations for Jobs and Rates
Amid market volatility and a complex mix of influencing factors, gold continued its upward momentum in Wednesday's trading, supported by growing concerns in global financial circles about U.S. fiscal sustainability and looming trade policies. These concerns have been heightened by a massive new spending bill passed by the U.S. Congress, which could add an estimated $3.3 trillion to the national debt.
In local markets, gold prices rose by EGP 10 during today's trading compared to the close of yesterday's session. The price of 21-karat gold reached EGP 4,650 per gram, while the global spot price increased by $7 to reach around $3,345 per ounce.
Other local gold prices included:
24-karat gold: EGP 5,314 per gram
18-karat gold: EGP 3,989 per gram
14-karat gold: EGP 3,100 per gram
Gold pound coin: EGP 37,200
On Tuesday, gold prices in local markets had also increased by EGP 20, with 21-karat gold opening at EGP 4,620 and closing at EGP 4,640. Meanwhile, global gold prices rose by $30, from $3,308 to $3,338 per ounce.
Despite mixed U.S. labor data, gold held its ground above the critical $3,300 level, posting modest gains. This came even after the latest JOLTS report (Job Openings and Labor Turnover Survey) surprised markets with an unexpected rise in job openings.
Rising Fiscal Risks Fuel Safe-Haven Demand
The U.S. Senate's approval of President Donald Trump's tax and spending package has sparked new concerns about widening federal deficits, prompting investors to seek refuge in gold—despite rising U.S. bond yields, which typically weigh on gold demand.
A recent research note from a major bank projected that gold prices could fluctuate between $3,100 and $3,600 per ounce through the remainder of the year. The bank expects gold to end 2025 at $3,175 before retreating to $3,025 in 2026—underscoring the heightened uncertainty in the market outlook.
Markets Await Key Jobs Data
With anticipation building, investor attention is now focused on the ADP private-sector employment report due later today, which will serve as a precursor to Thursday's official nonfarm payrolls report. These data points could prove pivotal in shaping the Federal Reserve's monetary policy for the rest of the year.
Job openings in May rose to 7.77 million from 7.39 million in April, casting doubt on near-term interest rate cuts. However, the decline in hiring could indicate early signs of labor market weakness.
Federal Reserve Governor Christopher Waller remarked recently that the Fed should not wait for a labor market collapse to adjust interest rates—highlighting internal divisions within the central bank's policy approach.
Trade Deadline Adds to Market Jitters
Markets are also closely watching the July 9 deadline set by President Trump to implement a new wave of tariffs. Trump has repeatedly ruled out any extensions and has signaled immediate action against trading partners, adding to market unease and reinforcing gold's safe-haven appeal.
While the anticipated tariffs could fuel inflationary pressures, limiting the Fed's ability to aggressively cut interest rates, they would likely keep real yields low—a relatively bullish factor for gold.
Central Banks Maintain Gold Buying Momentum
Amid these macroeconomic and geopolitical risks, gold remains a cornerstone in many investment strategies—not just as a traditional safe-haven, but as a hedge against the dollar and inflation.
According to the World Gold Council (WGC), central banks continued to accumulate gold in May, with net purchases totaling 20 tonnes. Kazakhstan, Turkey, and Poland led the buying, while Singapore and Uzbekistan continued reducing their holdings.
The WGC's 2025 survey shows a strong bullish tilt:
95% of central banks expect global gold reserves to increase over the next year.
43% plan to increase their own gold reserves—the highest percentage ever recorded.
Saxo Bank: Precious Metals as Strategic Portfolio Anchors
In a recent analytical report, Saxo Bank analysts emphasized that gold and silver still hold strategic positions in investment portfolios—not only as safe havens but also as assets that behave differently during market turmoil.
Gold, the report notes, is not consumed like other commodities and does not lose value, reinforcing its unique monetary role during periods of instability.
Silver combines its function as a store of value with rising industrial demand, making it more volatile but more responsive to economic cycles. Meanwhile, platinum remains tied to the future of technology and clean energy industries.
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