Gold resumes advance as Russia-Ukraine talks re-ignited a shift

By Bharat Gautam

(Reuters) - Gold bounced above the $2,000 an ounce level on Thursday following a sharp correction in the last session as a lack of progress with the Russia-Ukraine talks re-ignited a shift into safe-haven assets.

 

Spot gold rose 0.7% to $2,004.89 per ounce by 1203 GMT after tumbling as much as 3% on Wednesday. U.S. gold futures were up 1.2% to $2,011.00.

 

"Gold bulls have shown little qualm in catapulting prices higher on signs the Ukraine crisis could drastically worsen the global economic outlook," Han Tan, chief market analyst at Exinity said.

 

A rush to safe-haven assets earlier this week due to the Ukraine crisis powered gold prices to near record levels hit in August 2020.

 

"The safe-haven allure for gold is maintained despite the markets assimilation with commodity supply shocks and will be a driving force for bullion as the war in Ukraine persists," DailyFX analyst Warren Venketas wrote in a note.

 

A rebound in equities wilted as analysts warned of further pain for stocks with no immediate end in sight to the war in Ukraine.

 

Investors are also keeping an eye on February U.S. consumer price index data which is due later in the day, against the backdrop of surging oil prices and ahead of the Federal Reserve's next policy statement on March 16.

 

Palladium, used by automakers in catalytic converters to curb emissions, was up 0.2% to $2,944.25 per ounce. The metal hit a record high of $3,440.76 on Monday, driven by fears of supply disruptions from top producer Russia.

 

The palladium market "should continue to price-in a supply risk premium in the short-term," ANZ analysts wrote in a note.

 

Spot silver rose 0.7% to $25.92 per ounce, while platinum added 1.7% to $1,094.31.

 

(Reporting by Bharat Govind Gautam in Bengaluru; Editing by Krishna Chandra Eluri)