Gold Prices Soar as Fed Keeps Interest Rates Unchanged Amid Division Over Monetary Policy

The price of gold in local markets and global stock exchanges surged after the US Federal Reserve's decision to keep interest rates unchanged. This move, while largely expected by market analysts, has left policymakers divided on the future trajectory of monetary policy.

The price of a 21-karat gold gram rose by about EGP 50 compared to yesterday's close, reaching around EGP 5,930. The global ounce also increased by about $84, recording around $4,112. In addition, the prices of 24-karat and 18-karat gold grams were recorded at around EGP 6,777 and EGP 5,083 respectively.

The Fed's decision to hold interest rates within the 3.50% to 3.75% target range was made through a 9-to-3 vote. Three members preferred raising the federal funds rate by 25 basis points, revealing ongoing concerns about inflation risks. However, this move does not necessarily mean that future rate hikes are off the table.

Gold's rally following the decision reflects market expectations of declining monetary tightening, which has put pressure on the dollar and yields while lowering the opportunity cost of holding gold. The metal remains highly sensitive to any changes in interest rate expectations, especially given ongoing uncertainty regarding US monetary strategy.