Finally: Gold Prices in Egypt Decline After 3-Day Hiatus
- After a 3-day pause in pricing, Egypt’s Jewelry and Gold Division has resumed setting daily gold rates, announcing a 30 pound per gram decline for 21k gold on January 27th, 2023.
Reason for the Pricing Hiatus
- Pricing was halted due to instability in the dollar-to-pound exchange rate and speculative gold trading, causing market paralysis.
- The division warned citizens against purchasing or trading gold during the turbulence.
Updated Gold Rates – January 27th
1. 21k gold: 3,825 EGP per gram, down from 3,855 EGP on January 25th
2. 24k gold: 4,372 EGP per gram
3. A Pound of Gold: 30,800 EGP, a 240 EGP decrease
Fluctuating Dollar Exchange Rate
- Egypt’s open currency policy introduced in 2022 pegs the pound’s rate to supply and demand dynamics.
- The flexible exchange rate aimed to qualify Egypt for an IMF loan, but caused uncertainty.
- Gold traders paused pricing as a weakening pound increased bullion’s costs.
Impact on Egypt’s Jewelry Sector
- Without fixed daily rates, Cairo’s busy gold souk faced stalled sales.
- Jewelers struggled with unstable prices that change hourly rather than daily.
- Despite lower prices, lack of transparency and fears of more fluctuations may curb demand.
Government Warnings Against Speculation
As economic volatility increased gold demand, Egypt’s Treasury warned that strictly regulating the precious metal is key to stabilizing broader markets.
Citizens were cautioned not to deal in gold or buy on credit during rate instability, as more constraints may follow.
Finally
- While the 3-day pricing stoppage disrupted Egypt’s sizable jewelery sector, resumed gold rates aim to settle turbulent markets, despite declining 30 pounds from last week.
