“Rising Gold Prices Driven by Global Uncertainty and High Demand in Markets”

No voice in the markets rises above the movement gold The continuous ups and downs coincide with the rise in demand. In this context, Dr. Mohamed Abdel-Wahhab, an economic analyst, believes that the reason for the rise in gold prices locally, despite its decline globally, is the high demand for the precious metal in the markets.

He pointed out that for the market gold Globally, he said, “There are expectations that gold prices will continue to rise, driven by the state of uncertainty resulting from the geopolitical conditions and economic turmoil that the world is witnessing as a result of the state of conflict that exists between the major poles, America and Europe on one side, and Russia and China on the other side, and the continuous rise in inflation rates globally and locally, and the accompanying increase in inflation rates.” in interest rates.

Gold trading

Gold prices are trading in a narrow range, as spot gold prices move at the time of writing the report at the level of $1999.60 an ounce, recording an increase of 0.1%. This comes after gold rose yesterday by 0.4%.

Gold trading was confined this week below the psychological level of $2,000 an ounce, in the absence of statements by the Federal Reserve members after the start of the media blackout for the bank this week before its upcoming meeting next week.

Data released on Tuesday indicated that consumer confidence in the United States fell to a nine-month low in April amid mounting fears about the future, raising the risk of the economy falling into recession this year.

This data caused an increase in the demand for a safe haven yesterday, to witness the rise of both gold and the US dollar at the same time, especially since the index data coincided with the issuance of the results of the profits of the American First Republic Bank, which has been affected since the banking crisis last March, to show the bank’s lists a decrease in deposits by 100%. billion dollars, which brought tension back to the markets over the banking crisis.

The situation quickly reversed on the US stock markets, as the broader S&P500 index fell by 1.6% during yesterday’s trading, hitting a two-week low, and the Dow Jones Industrial Average fell by 1%.

The fears that hit the financial markets yesterday were not enough to push gold to trade again above the $2000 level, with gold markets awaiting the most important economic data this week represented in the US gross domestic product for the first quarter, and the personal consumption expenditures index, which is the preferred inflation indicator. to the Federal Bank.

These indicators will help to better predict the decisions of the Federal Reserve during its meeting next week, and provide a better view of the future of interest rates and monetary policy, which is what gold needs during this period to determine its direction in the short to medium term.

The Fed’s interest rate watch tool indicates an 80% probability that the bank will raise interest rates by 25 basis points at the May meeting next week, as the probability decreased from 90% during the beginning of this week, after lower-than-expected consumer confidence data along with tensions Related to First Republic Bank.

It is noteworthy that the possibilities that were referring to another interest rate hike at the bank’s next June meeting have disappeared from the markets, and in return expectations have returned indicating the possibility of lowering interest rates by September, which is the expectations that none of the Fed’s members referred to in their previous statements.