cairo 21/1/2024
Engineer Hani Milad Gaid, Head of the General Gold Division at the Federation of Chambers of Commerce, revealed that the recent statements made by several Federal Reserve Bank officials pushed the dollar to its highest monthly level and were also a major reason for the decline in gold prices in global markets during the past week, as the dollar recorded during the last trading at 102.833 after closing at 102.589 and is currently settling 0.75% higher at 103.348, while February gold futures prices fell by $20 or 0.97% and stabilized at $2031.60, and this is only a slight recovery from today’s low of $2027.60.
On top of these statements came what Governor Christopher Waller, one of the twelve members of the Federal Reserve Bank, said in response to expectations of a possible reduction in interest rates during the first quarter of this year, which had a direct impact on the decline in the price of the dollar in global inches. Pointing out that the Fed will take this step, but not as quickly as analysts expect, to ease monetary policy, pointing out that this policy cannot be eased in light of the inflation rates in the American markets, which refuse to fall to the target rates, and he also does not see the need to rush in taking mitigating measures at the present time.
Waller’s speech comes after several Federal Reserve officials addressed the timing and number of interest rate cuts that the Fed will implement this year, including John Williams, who said that he does not expect interest rate cuts to occur until the Fed is confident that inflation will… It returns significantly to its target of 2%, and these statements are consistent with what Federal Reserve Chair Loretta Mester said last week and the statements of Tom Barkin, President of the Federal Reserve Bank of Richmond, These collective statements come alongside cautious statements by European Central Bank officials, To emphasize that an interest rate cut in March is unlikely, it remains supportive of expectations of a reduction in interest rates by the Federal Reserve this year by 75 basis points by the end of the second quarter.
Milad explained that the importance of the US Federal Reserve’s monetary policy does not stop at influencing the price of the dollar in global markets and gold prices, but rather extends to the return of direct foreign investments to emerging markets, which are looking for ways to finance their economies amid unprecedented global inflation rates and declining global growth rates, and despite all these statements. However, reality confirms the accelerating weakness of the American economy, starting with the increase in the volume of foreign debt, the failure of inflation rates to decline as desired, and successive collapses of American banks, with the presence of the specter of recession and economic contraction, the impact of which has appeared on the global economy, giving the impression that these statements are a new episode in the American series of using statements. The media is trying to control the deteriorating economic conditions.
As for the local level, the gold markets have witnessed successive rises since the last week of last year to record record highs amid a state of uncertainty about the future of prices on global stock exchanges, especially with the escalation of geopolitical conflicts in the Middle East region and the expansion of the circle of conflict against the Zionist entity with the continuing dollar liquidity crisis in addition to… There are pressures of increasing demand for gold as a safe haven and a hedge against new inflationary waves, so that the price of a gram of 21 at the time of writing the report exceeded 3,560 pounds, while the pound of gold before calculating stamp duty, tax, and the value of workmanship reached 28,480 pounds, while the 18 karat carat, which is most common in the production of gold jewelry, exceeded 28 thousand and 480 pounds. Three thousand pounds per gram.
