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Bengaluru — Gold held steady on Tuesday as Russia-Ukraine concerns kept the safe-haven metal supported near the previous session’s over one-week high, while markets await US inflation data that is crucial for the US Federal Reserve’s tapering timeline.
Spot gold rose 0.1% to $1,821.61 an ounce by 4.34am GMT, having risen to the highest level since January 26 on Monday. US gold futures were steady at $1,822.50.
“Geopolitical tensions surrounding Russia and Ukraine are pushing gold prices higher. Besides, investors are waiting for Thursday’s US inflation data,” said Margaret Yang, a strategist at DailyFX, adding that January inflation is projected to rise higher than December levels.
According to a Reuters poll, the US consumer price index for January is expected at an annual rise of 7.3%, which would be the largest such increase since 1982, and could pile on pressure on the Fed for aggressive tightening. Gold is considered a hedge against inflation and geopolitical risks, yet rate hikes would raise the opportunity cost of holding non-yielding bullion.
“The overall momentum for gold appears to be weak. The upside may be limited given the fact that the market is pricing in five to six quarter point rate hikes by the Federal Reserve this year,” Yang said.
Limiting gold’s gains, the benchmark 10-year US treasuries firmed near their highest levels in over two years.
If Russia invades Ukraine, US President Joe Biden said on Monday that the Nord Stream 2 gas pipeline would be halted while British Prime Minister Boris Johnson said sanctions and other measures will be ready.
The solid demand for safe-haven assets like gold amid rising geopolitical tension has helped offset concerns of imminent monetary policy tightening by the US Federal Reserve, ANZ said in a note.
Silver fell 0.3% to $22.93 an ounce, platinum was down 0.3% at $1,016.49, while palladium inched 0.2% up to $2,267.35.
Support our award-winning journalism. The Premium package (digital only) is R30 for the first month and thereafter you pay R129 p/m now ad-free for all subscribers.
Gold firms as geopolitical risks boost demand
Bengaluru — Gold held steady on Tuesday as Russia-Ukraine concerns kept the safe-haven metal supported near the previous session’s over one-week high, while markets await US inflation data that is crucial for the US Federal Reserve’s tapering timeline.
Spot gold rose 0.1% to $1,821.61 an ounce by 4.34am GMT, having risen to the highest level since January 26 on Monday. US gold futures were steady at $1,822.50.
“Geopolitical tensions surrounding Russia and Ukraine are pushing gold prices higher. Besides, investors are waiting for Thursday’s US inflation data,” said Margaret Yang, a strategist at DailyFX, adding that January inflation is projected to rise higher than December levels.
According to a Reuters poll, the US consumer price index for January is expected at an annual rise of 7.3%, which would be the largest such increase since 1982, and could pile on pressure on the Fed for aggressive tightening. Gold is considered a hedge against inflation and geopolitical risks, yet rate hikes would raise the opportunity cost of holding non-yielding bullion.
“The overall momentum for gold appears to be weak. The upside may be limited given the fact that the market is pricing in five to six quarter point rate hikes by the Federal Reserve this year,” Yang said.
Limiting gold’s gains, the benchmark 10-year US treasuries firmed near their highest levels in over two years.
If Russia invades Ukraine, US President Joe Biden said on Monday that the Nord Stream 2 gas pipeline would be halted while British Prime Minister Boris Johnson said sanctions and other measures will be ready.
The solid demand for safe-haven assets like gold amid rising geopolitical tension has helped offset concerns of imminent monetary policy tightening by the US Federal Reserve, ANZ said in a note.
Silver fell 0.3% to $22.93 an ounce, platinum was down 0.3% at $1,016.49, while palladium inched 0.2% up to $2,267.35.
Reuters
Russian forces almost ready for Ukraine invasion, US warns
Russia inks new gas deal with China
Gold hits one-week high as inflation pressures offset US Treasury yield rally
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