Gold slips as investors take a breath after news of upcoming Russia-US meeting
Bengaluru — Gold prices retreated on Friday, after breaking above the key $1,900 level for a second consecutive session, as a Russia-US meeting next week slowed investors’ dash to the safety of bullion.
Spot gold fell 0.3% to $1,890.77/oz, as of 3.08am GMT, after touching its highest in eight months at $1,902.22/oz earlier in the session. US gold futures dropped 0.5% to $1,892.70/oz.
US stock futures bounced on Friday and selling pressure eased in Asian share markets after the US secretary of state agreed to a meeting with Russia’s foreign minister, raising hopes for a diplomatic solution to the East-West standoff over Ukraine.
One of the deepest crises in post-Cold War relations is playing out in Europe as Russia wants security guarantees, including Kyiv never joining Nato, and the US and allies offer arms control and confidence-building measures.
“We are seeing gold in extension of that invasion trade, said IG Markets analyst Kyle Rodda and “the next technical level to watch is around $1,920, so there’s certainly technical basis to see gold prices rise.”
On Thursday, gold rose as much as 1.8%, breaking past $1,900/oz for the first time since June 11, with analysts expecting a further rally if tensions continue to escalate, and vice versa.
US 10-year Treasury yields firmed, increasing the opportunity cost of holding non-interest-paying bullion. Spot gold, however, is set for a third straight weekly gain, up about 1.7% so far.
“In the short term, bullion market inflows have clearly been buttressed by Russia-Ukraine geopolitics, higher equity market vols, and inflation hedge demand,” analysts at Citi said in a note.
Spot silver was little changed at $23.80/oz and palladium dipped 0.7% to $2,349.52/oz, with both set for small weekly gains. Platinum gained 0.3% to $1,091.95/oz, setting up its best weekly showing since June.
Reuters
Source: businesslive.co.za