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Gold nears two-month high as Russia-Ukraine tensions simmer

Spot gold was 0.5% higher at $1,841.50 per ounce by 1013 GMT, holding close to last week's high of $1,847.42 an ounce. U.S. gold futures rose an equal amount to $1,840.70

Photo: Bloomberg

Photo: Bloomberg

By Asha Sistla
(Reuters) - Gold prices advanced towards last week's two-month high on Monday as U.S. bond yields continued to fall and investors looked to invest in the safe-haven metal over concerns about tensions between Russia and Ukraine.
Spot gold XAU= was 0.5% higher at $1,841.50 per ounce by 1013 GMT, holding close to last week's high of $1,847.42 an ounce. U.S. gold futures GCv1 rose an equal amount to $1,840.70.
Investors are looking towards the U.S. Federal Reserve's two-day policy meeting starting on Tuesday. The Fed is expected tighten monetary policy at a much faster pace than thought a month ago to tame persistently high inflation.
"I don't expect (Fed) to have a significant impact on what gold prices are doing at this moment because the markets are more concerned about what's going on in Eastern Europe," said Michael Hewson, chief market analyst at CMC Markets UK.
"The markets have already priced in a March hike so I don't think there's going to be any surprise."
Rising U.S. interest rates increase the opportunity cost of holding non-interest-bearing bullion. Benchmark U.S. 10-year Treasury yields fell to an one-week low, helping gold. US/
The U.S. State Department has ordered diplomats' family members to leave Ukraine, as U.S. President Joe Biden weighs options to counter a buildup of Russian troops in Ukraine. (Full Story)
Signs of poor risk appetite were displayed across markets as Asian and European shares slipped on worries over tighter monetary policy. MKTS/GLOB.EU
"Assuming that the current wave of risk aversion ebbs away eventually as the Fed addresses these fears, and barring a deterioration of the economic outlook, we thus believe that the gold and silver markets are again experiencing a temporary but no lasting rebound," Julius Baer analyst Carsten Menke said.
Spot silver fell 0.4% to $24.12 an ounce and platinum XPT= was steady at $1,029.53.
Palladium rose 0.2% to $2,111.11, holding close to the last session's two-month peak.
(Reporting by Asha Sistla in Bengaluru; Editing by Rashmi Aich)

(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

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First Published: Jan 24 2022 | 4:45 PM IST

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