Gold jewellery demand in Egypt rises 2% in Q2 2024: WGC report 

The report, however, indicates other negative signs such as 16% sales decline and 27% drop in gold investment in the same quarter 

Cairo — According to a recent report from the World Gold Council (WGC), the demand for gold jewellery in Egypt saw a modest increase of 2% in the second quarter of 2024, reaching 6.8 tons. This uptick follows the International Monetary Fund (IMF) Extended Fund Facility (EFF) loan agreement signed in March, which has been credited with boosting gold demand during the Eid Al-Adha season. 

The seasonal surge, marked by weddings and vacations, appears to have contributed to the rise in gold jewellery demand. This period of increased consumer activity coincided with a reduction in gold prices, driven by improvements in Egypt’s currency situation post-IMF loan. 

In March 2024, Egypt’s Central Bank floated the national currency, which is now valued at 48.39 EGP to the dollar, as part of a new agreement with the IMF that expanded Egypt’s loan from $3 billion to $8 billion. 

Despite the rise in jewellery demand, overall gold purchases in Egypt decreased by 16% in Q2 2024, totaling 14.4 tons compared to 17.1 tons in the same quarter of 2023. The decline in purchase volume is attributed to a 300% surge in gold prices in Q2 2023, prompting Prime Minister Mostafa Madbouly to issue a decree in May 2023 that exempted gold carried by travellers from customs duties and other fees, with the exception of value-added tax (VAT), to address the price spike and supply shortage. 

The WGC report also highlights a 27% drop in gold investment, which fell to 7.6 tons in Q2 2024 from 10.4 tons in Q2 2023. Additionally, demand for gold bullion and coins saw a decrease, reaching 5.2 tons in Q2 2024, down from the first quarter of the same year. This decline is attributed to the IMF loan’s impact on reducing the perceived need to hedge against currency fluctuations. 

Overall, while the IMF loan has helped stabilise the currency and affected consumer behaviour, the gold market in Egypt continues to experience fluctuations in both demand and investment. 
 
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