A Reuters report said the significant rise in prices has put gold out of reach for many and silver has become the preferred option for Egyptians to counter the effects of inflation.
According to the agency, fluctuations in the parallel currency market in Egypt and an expected fall in the value of the pound (the local currency) led to chaos in gold trading, leading some to resort to silver. To preserve the value of their savings.
The pound has fallen nearly 50% against the dollar since the start of 2022, as the country faces a growing shortage of foreign currency inflows.
But it collapsed on the black market, at a time when Egyptians wanted to protect their savings by buying dollars, precious metals and real estate.
In a country where it is estimated that about 60% of its 105 million population lives below or near the poverty line, only a few of them can afford to invest in high-end real estate whose sales are rapidly increasing. As stated by Reuters in its report.
The price of the dollar on the black market reached 71 pounds last month, compared to the official price of 30.85 pounds, before falling to less than 60 pounds in recent days amid expectations of an expansion of financing provided by the International Monetary Fund and reports that Was. Emirati investments on Egypt's Mediterranean coast.
The Egyptian Central Agency for Public Mobilization and Statistics said yesterday, Thursday, that annual consumer price inflation in cities fell to 29.8% from 33.7% last month, much lower than analysts expected.
According to the World Gold Council's annual report, demand for gold coins and bullion in Egypt is expected to increase by 57.8% between 2022 and 2023.
The price of a gram of 21-karat gold also rose 122.7% to 3,875 pounds ($126) in the year ended Jan. 30, according to the General Federation of Chambers of Commerce.
Reuters quoted economic expert Ihab Samra as saying the demand was driven by “panic”, adding that “owning gold at the moment is neither an investment nor a savings, it is taking money out of legitimate possession and seeking a safe haven.” There is migration.” Protect someone's money.”
For his part, Ihab Wassef, head of the gold division of the Federation of Egyptian Industries, believes current gold prices are “unfair” and it is “illogical” to buy the yellow metal during this turbulent period.
He also said that the recent rush of people to buy gold is due to “trends going on on social media pages that say: buy gold, gold rises.”
According to a report by Al Jazeera Net correspondent, which was published late last month, gold markets in Egypt are witnessing a state of confusion, as authorities have arrested several prominent gold traders under the pretext of manipulation. Besides being accused of hoarding bullion and being responsible for the dollar's rise, prices were fueled by demand to buy it. Traders and their counterparts abroad to import foreign raw materials to secure the gold market needs as well as to meet major international obligations.
Seeing the rise in gold prices, many Egyptians began buying silver, and Reuters quoted an Egyptian woman as saying she was forced to choose silver because she wanted to buy a “small earring” of 18-karat gold. Whose weight was less than one gram. Now its price has exceeded 3,000 pounds.
Reuters quoted Wasfi Amin, an adviser to the gold and mining division of the Federation of Egyptian Industries, as saying demand for silver bullion and silver jewelery is rising, despite some considering them “second-class”.
Hani Wassef, a well-known silver trader in the Khan Abu Takiya area of old Cairo, said his customers are usually people with limited income who want to preserve the value of their money and cannot afford gold.
Abanoub, a silver shop salesman in Cairo who requested that only his first name be used, noted that some newlywed couples buy silver wedding rings instead of the usual gold ones, and said that “silver has become gold. “
The price of one gram of silver more than doubled within a year to £47.