“The Controversial Rise of Gold Prices in Egypt: Reasons, Impact, and Government Response”

So what are the reasons? How do gold prices look today in Egypt?

At the end of last week, gold prices in Egypt recorded unprecedented historical levels.

For the first time in the history of Egypt, the price of a gram of gold exceeded 3,000 pounds, or about $100.

A gram of 24 karat gold reached 3028 pounds, while the price of a gram of 18 karat reached approximately 2270 pounds.

According to Egyptian websites, the price of a gram of 21 carat gold, which is the best-selling in Egypt, recorded 2,650 pounds, instead of 2,600 pounds, in Sunday’s trading.

Despite the decline in gold prices in early Monday trading, affected by the rise in the dollar, some people still complain about its crazy price and call for caution before buying it.

This comes in conjunction with the heavy spread of a report by the economic investing website, which indicated that gold in Egypt is sold 53% higher than its global price.

The report of the British website indicated that the current prices indicate “setting a value of gold at about 47 pounds per dollar, while the dollar in Egyptian banks records 30.9 pounds per dollar.”

The Egyptians’ increasing interest and interest in the yellow metal is due to their continuous interest in the global economic crisis and its repercussions, which deepened the financial crisis that their country is going through.

With the record decline in the value of the Egyptian pound, Egyptians resorted to buying gold to preserve the value of their savings.

This increased the demand for the yellow metal, despite the lack of supply and the difference in price from one store to another, according to what Egyptians mentioned on the communication sites.

Some describe what happened in the gold markets and goldsmiths’ shops in the recent period as “chaos”.

Among the commentators are those who link the Egyptians’ tendency to buy gold with their lack of confidence in the future.

In a post on Facebook, the Egyptian economist Alia Al-Mahdi enumerated the reasons for the insane rise in the price of gold in Egypt, despite its global decline.

I wrote, “What happened is a reflection of several things, the most important of which is the country’s economic mismanagement, lack of confidence in the very near economic future, confusion, and the high degree of speculation on easily liquefiable assets such as free currencies and gold.”

While others limit the reasons for that rise to two points, the most important of which are “monopoly” and “the fears of gold traders of a new reduction in the price of the pound.”

In this context, tweeter Islam Mansour says: “The goldsmiths’ shops priced the dollar at 44.43 pounds, even though its official price in banks is 30.85 pounds, and this is due to speculation after strong rumors about a new flotation of the value of the pound. Egypt?”

Generally gold is used as a buffer against inflation and economic and financial turmoil. Its prices are affected by a number of factors, most notably:

This factor affects the price of gold, just like any other commodity. An increase in demand and a decrease in supply leads to an increase in the price, and vice versa, an increase in supply and a decrease in demand leads to a decrease in prices.

The difficulty of the gold mining process over time is one of the reasons for the continuous rise in its prices in the long term.

Conditions on global stock exchanges and decisions taken by central banks regarding interest rates and inflation will inevitably affect this precious metal. Low interest rates and high inflation rates lead to an increase in gold prices.

The same applies to exchange rates, if the local currency is weak, this will lead to an increase in gold prices.

Political turmoil, conflicts and terrorist threats are all factors that may cause gold prices to rise. It is difficult to measure how such matters affect gold prices compared to previous factors, and they vary from one case to another.

In the Egyptian case, there are those who link the recent rise in gold prices to the events taking place in Sudan.

In addition to the main factors related to high inflation rates and the depreciation of the pound against the dollar, experts say that the crisis in Sudan may indirectly affect supply in the local market.

But that analysis looks like ” Exaggerated“ As for others who indicated that gold sales are witnessing a rise during the Eid Al-Fitr period and seasons, due to the demand for buying the network and the spread of wedding parties.

Those about to get married expressed their surprise at the high price of gold.

Others spoke of their helplessness in the face of what they called “manipulation and speculation in gold prices.”

As usual, Egyptians resorted to jokes and cartoons to simulate what happened in the gold market.

Some of them imagined the shape of the network in the future, and a picture of bracelets made of orange peels or cheap metal spread.

Some commentators suggested giving up gold as a necessary condition for completing the engagement and replacing it with silver.

Tweeters also asked about the timing of gold’s stability, and made comparisons between its current price and what it was a year ago.

Others blamed the government for urgent economic reforms.

On the other hand, tweeters underestimated the importance of what is happening and accused political parties of exaggerating the matter.

Some people even questioned the purchase movement, describing it as “non-spontaneous”.

Others warned of the transformation of gold into currency, and considered that trading in gold instead of currency poses a threat to the economy.

While others likened the market movement to the “classic price bubble”.

It is a term used to describe the change in the behavior of investors and the increase in demand for a particular commodity, so that the price increases with it in a way that is not commensurate with its real value.

Some appealed to the government to intervene and provide solutions.

The response came through the Minister of Supply, Ali Al-Moselhi, who suggested exempting Egyptians coming from abroad from fees Customs imposed on gold.

Many expect that this proposal will contribute to reducing the demand for the yellow metal at home, which will reduce its price.

The minister acknowledged that “the amount of gold is very limited and that there is a price gap,” but he linked it to “the bid price, the international price, and the dollar.”

Parliament member Ilaria Samir also called for tightening control over the gold markets and goldsmiths’ shops, and for educating citizens about all developments in the gold market and its prices globally.