Gold climbs as Russia-Ukraine tension fuels safe-haven demand
Metal rises for fourth consecutive session, while traders await Fed cooments for rate cut clues
21 November 2024 - 07:38
byDaksh Grover
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Bengaluru — Gold prices rose for the fourth consecutive session on Thursday, driven by safe-haven demand amid escalating tension in the Russia-Ukraine conflict, while investors awaited remarks from Federal Reserve policymakers on the interest rate outlook.
Spot gold was up 0.3% at $2,657.41/oz by 2.38am GMT, hitting its highest since November 11. US gold futures rose 0.3% to $2,660.00.
“The escalation in the war between Russia and Ukraine and subsequent fears of a broader regional conflict that involves increasing threats of nuclear weapons are pushing up [gold] prices,” said Kyle Rodda, financial market analyst at Capital.com.
Ukraine fired a series of British Storm Shadow cruise missiles into Russia on Wednesday, marking the latest use of Western weapons on Russian targets, just a day after firing US missiles.
Meanwhile, the US vetoed a UN Security Council resolution calling for a ceasefire in Gaza, adding to geopolitical tension.
Gold’s appeal is bolstered by geopolitical tension, economic risks and a low interest rate environment.
The dollar dropped by more than 0.1% on Thursday, making gold more affordable for international buyers.
Meanwhile, investors will monitor remarks from several Fed officials later in the day, while keeping an eye on initial US jobless claims data, due at 1.30pm GMT.
Markets see a 56% chance of a 25 basis point (bp) US rate cut in December, per the CME Fedwatch tool.
A potential December rate reduction could be a headwind for gold, but the long-term outlook for the metal remained bullish, Rodda said.
Two Fed governors offered contrasting perspectives on US monetary policy on Wednesday, with one raising concerns about stubborn inflation, while the other remained optimistic about continued progress in reducing price pressures.
SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, said its holdings rose 0.36% to 875.39 tonnes on Wednesday.
On Thursday, spot silver gained 0.8% to $31.11/oz, platinum added 0.4% to $965.30 and palladium advanced 0.7% to $1,027.84.
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 climbs as Russia-Ukraine tension fuels safe-haven demand
Metal rises for fourth consecutive session, while traders await Fed cooments for rate cut clues
Bengaluru — Gold prices rose for the fourth consecutive session on Thursday, driven by safe-haven demand amid escalating tension in the Russia-Ukraine conflict, while investors awaited remarks from Federal Reserve policymakers on the interest rate outlook.
Spot gold was up 0.3% at $2,657.41/oz by 2.38am GMT, hitting its highest since November 11. US gold futures rose 0.3% to $2,660.00.
“The escalation in the war between Russia and Ukraine and subsequent fears of a broader regional conflict that involves increasing threats of nuclear weapons are pushing up [gold] prices,” said Kyle Rodda, financial market analyst at Capital.com.
Ukraine fired a series of British Storm Shadow cruise missiles into Russia on Wednesday, marking the latest use of Western weapons on Russian targets, just a day after firing US missiles.
Meanwhile, the US vetoed a UN Security Council resolution calling for a ceasefire in Gaza, adding to geopolitical tension.
Gold’s appeal is bolstered by geopolitical tension, economic risks and a low interest rate environment.
The dollar dropped by more than 0.1% on Thursday, making gold more affordable for international buyers.
Meanwhile, investors will monitor remarks from several Fed officials later in the day, while keeping an eye on initial US jobless claims data, due at 1.30pm GMT.
Markets see a 56% chance of a 25 basis point (bp) US rate cut in December, per the CME Fedwatch tool.
A potential December rate reduction could be a headwind for gold, but the long-term outlook for the metal remained bullish, Rodda said.
Two Fed governors offered contrasting perspectives on US monetary policy on Wednesday, with one raising concerns about stubborn inflation, while the other remained optimistic about continued progress in reducing price pressures.
SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, said its holdings rose 0.36% to 875.39 tonnes on Wednesday.
On Thursday, spot silver gained 0.8% to $31.11/oz, platinum added 0.4% to $965.30 and palladium advanced 0.7% to $1,027.84.
Reuters
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