Egyptians carry on tradition of entrusting savings to gold
Many Egyptians see gold as the safest investment option for their savings, especially in times of economic uncertainty.
According to a report by the World Gold Council, spending on gold jewelry increased by 60% during the first nine months of 2021, compared to the same period last year. Egypt registered about 2% of global spending on gold.
Egyptians spent about 19.2 billion Egyptian pounds ($1.22 billion) on about 21.1 tons of gold in 2021, compared to about 12 billion pounds ($763.1 million) on about 13.8 tons in 2020.
The uptick is due to rising demand for gold as a safe investment option in light of the Central Bank's interest rate cuts to 8.25% for savings and 9.25% for loans, as well as a stable exchange rate for the Egyptian pound against the US dollar.
There is an inverse relationship between gold and economic confidence levels. The more the economy improves, the lower the gold prices. Rafiq Abbasi, head of the gold industry division of the Federation of Egyptian Industries, told Al-Monitor, “In the coming period, with the emergence of infections with the omicron variant and some countries making lockdown decisions, the worldwide economy is expected to witness regression, which will lead to a rise in gold prices. Now is the time to buy gold, before prices rise.”
