Gold prices recorded a new qualitative leap in global markets during trading yesterday (Tuesday), as the price of an ounce of gold soared to touch the level of $4,498, thus recording unprecedented historical levels in the history of trading in the precious metal.
This strong rise was supported by daily gains of about $54 in a single session, achieving a rise of 1.23%, which reflects the continued buying momentum and upward trend that has dominated financial markets in recent weeks, amid investors rushing to strengthen their portfolios with safe havens.
Economic factors driving prices
This exceptional performance of gold is closely linked to global monetary policies. The surge coincided with interest rate cuts implemented this month, as well as strong expectations of further monetary easing in the near future. Historically, there is an inverse relationship between interest rates and gold; the lower the interest rate, the lower the opportunity cost of holding gold, which does not generate a periodic return, making it more attractive compared to bonds and treasury bills, whose yields are declining.
Gold as a safe haven amid global concerns
In addition to monetary factors, psychological and macroeconomic factors play a pivotal role in this surge. Market concerns about a global economic slowdown are driving institutions and individuals toward gold as the traditional "safe haven" that preserves value during times of crisis and economic uncertainty. The precious metal is considered the primary hedge against inflation and currency volatility, which explains the increased demand for it to bolster investment positions.
Gold prices in the Saudi market
This global surge was directly reflected in the local market in Saudi Arabia. According to the latest trading data, prices were as follows:
- 24-karat gold: The price per gram was recorded at approximately 542 riyals. This karat is usually requested for investment and savings purposes in the form of gold bullion, and a simple stamping fee is added to it, which varies according to the weight and type of bullion.
- 21-karat gold: The price per gram reached approximately 474 riyals, which is the most popular and traded karat in the Kingdom for gold jewelry and ornaments. In addition to this price, the cost of "manufacturing" is added, which varies from one trader to another and according to the accuracy of the design, in addition to the value added tax and the seller's profit.
- 18-karat gold: The price per gram is around 407 riyals. It is characterized by its modern and diverse designs, and is also subject to the addition of manufacturing costs and tax upon purchase.
Investors and prospective buyers are advised to follow price updates in real time, given their direct link to the movement of the global stock market, which is experiencing continuous fluctuations based on the economic data released.
