Gold in Egypt up as Korea tensions, lower dollar affect global markets

Gold prices edged higher in Egypt on Wednesday by two Egyptian pounds ($0.113) as global gold markets recorded one-year highs buoyed by tensions on the Korean peninsula and a lower dollar.

The twenty-four carat gold was sold for 745.15 pounds; while the widely-spread in Egypt, twenty-one carat gold scored nearly 652 pounds.  The 18 carat gold reached 558.85 pounds.

Gold pound also rose by 16 pounds, Ehab Wasfy, a member at the gold department at the Federation of Egyptian Chambers of Commerce, told Amwal Al Ghad.

Globally, the precious metal climbed towards one-year highs on Wednesday, boosted by tensions on the Korean peninsula and a lower dollar due to growing expectations the Federal Reserve will delay rate rises. Spot gold was little changed at $1,338.30 an ounce, a gain of around 8 percent so far this quarter and more than 16 percent so far this year. It touched $1,344.21 an ounce on Tuesday, its highest since Sept. 8.

“Rising geopolitical tensions, the hurricane hitting the U.S. and the looming debt ceiling are increasing demand for safe assets,” Danske Bank analyst Jens Pederson told CNBC.

“These extraordinary factors are also weakening the dollar from the point of view that the Fed may further postpone normalisation of monetary policy, which would be good news as it would keep a lid on U.S. yields.”

Both U.S. government bonds and gold are seen as risk-free by investors. Low U.S. Treasury bond yields mean there is little opportunity cost in holding gold, which earns nothing and costs money to insure and store.

Comments
Loading...