Gold Poised for Record Highs, Eyes $5,000 Mark Amid Rate Cut Expectations

Gold is set to reach new historical peaks by the end of the current year, driven by a weakening U.S. dollar in emerging markets and anticipated interest rate cuts globally and domestically. The precious metal is projected to surpass the record highs achieved in 2025, a year that saw gold register exceptional gains of 60%. This upward trajectory comes as the global economy grapples with sluggish growth.

A World Gold Council report forecasts gold prices to jump to $5,000 per ounce in the initial weeks of 2026. This surge is attributed to sustained demand from central banks and investors, coupled with the U.S. Federal Reserve’s expected policy of reducing interest rates. Last week, gold futures settled at $4,388, having traded within a range of $4,336.25 to $4,336.90. Locally, gold prices remained stable last Tuesday, with 21-karat gold climbing to nearly 6,000 Egyptian pounds after the global price reached $4,400 per ounce.

Saeed Embaby, Executive Director of iSagha platform, stated that global gold exchanges are poised for a significant rise. He noted that major world economies are likely to adopt interest rate cuts, providing unprecedented support for gold as a safe haven asset. Embaby highlighted gold’s superior investment performance, citing an example where a 100,000 EGP investment in gold yielded 60,000 EGP in profit over a year, compared to 30-40% for savings certificates or real estate.

Embaby also indicated Egypt’s efforts to boost gold production from its mines and support the local jewelry manufacturing industry.

Amr Zaki, a member of the Gold Division at the Federation of Chambers of Commerce, emphasized that hedging against crises remains a dominant theme in the global political and economic landscape. Amid fluctuating inflation rates, decision-makers worldwide are seeking to reduce pressure on the dollar and hedge against trade tensions, making gold a universally sought-after asset. This trend has impacted buying and selling activity within local gold markets.

Zaki projects gold to reach $5,000 per ounce during the first quarter of next year, contingent on sustained demand, continued interest rate reductions, a decline in the dollar’s value against other currencies, and increased geopolitical tensions. Such a scenario would push 21-karat gold above 6,000 EGP and 24-karat gold to 7,000 EGP. He added that the local market is currently experiencing stability and calm in jewelry purchases.