Gold prices rose in local markets and on the global stock exchange during trading on Monday, driven by escalating geopolitical tensions, particularly between the United States and Venezuela, which boosted demand for gold as a safe haven, according to a report issued by the online gold and jewelry trading platform, D-Saghah.
Saeed Embaby, the platform’s CEO, said that gold prices rose locally by about 40 pounds, with the price of a gram of 21-karat gold reaching 5,930 pounds, while the price of an ounce on the global stock exchange jumped by about $80 to reach $4,412.
He added that the price of a gram of 24-karat gold reached about 6777 pounds, while 18-karat gold recorded about 5083 pounds, and the price of a gold pound rose to about 47440 pounds.
The platform's report explained that gold's gains today were supported by several factors, most notably expectations of interest rate cuts, continued gold purchases by central banks, and escalating concerns related to geopolitical tensions and global economic uncertainty.
On the geopolitical front, recent developments between the United States and Venezuela have heightened market anxiety, after the United States launched a large-scale military operation over the weekend, including air and ground raids, which resulted in the arrest of Venezuelan President Nicolas Maduro and his wife, Cilia Flores.
This escalation, along with the ongoing Russian-Ukrainian conflict, has kept gold prices supported near their record high of $4,555 an ounce reached on December 26.
The turbulent geopolitical landscape, along with the direction of the US Federal Reserve, remains a focus for investors, especially in light of the international criticism sparked by recent developments in Venezuela, US warnings to other countries in the region, and renewed debate over geopolitical issues with strategic dimensions.
At the same time, gold prices received additional support from market expectations of further monetary easing by the Federal Reserve, with a week full of influential US economic data ahead.
Today, investors are focused on the release of the Institute for Supply Management's manufacturing purchasing managers' index for December, followed by the release of the Standard & Poor's composite and services purchasing managers' indices on Tuesday.
Markets are also awaiting the ISM Services Purchasing Managers’ Index data and the job openings report next Wednesday, followed by weekly unemployment claims data on Thursday, and finally the non-farm payrolls report next Friday.
On the monetary policy front, markets expect two interest rate cuts this year, following a cumulative cut of 75 basis points in 2025, but the Federal Reserve’s latest projections from its December meeting indicate only one cut in 2026.
Recent economic data showed that the US economy grew at an annual rate of 4.3% during the third quarter, while inflation showed signs of slowing, with the Consumer Price Index rising by 2.7% on an annual basis in November, opening the door for further monetary easing.
Anna Paulson, president of the Federal Reserve Bank of Philadelphia, said that inflation is likely to slow and that the labor market remains resilient, with expectations that U.S. economic growth will reach about 2% this year.
She added that the current level of interest rates remains relatively restrained, noting that some limited adjustments to monetary policy may be appropriate later in the year.
According to the CME FedWatch tool, markets widely expect the Federal Reserve to keep interest rates unchanged at its scheduled meeting on January 27 and 28, with a low probability of a rate cut of 18.3%, while the probability of a cut rises to around 44% at the March meeting.
