Gold surges as Russian invasion of Ukraine rattles investors

Gold prices on Thursday jumped more than 2% to their highest in more than a year as investors rushed to safe havens after Russian forces invaded Ukraine in what could be the start of war in Europe.

Spot gold jumped 1.9% to $1,943.86/oz by 4.28am GMT, its highest level since early January 2021. US gold futures climbed 2% to $1,949.20.

Russian forces fired missiles at several Ukrainian cities and landed troops on its south coast, officials and media said, after President Vladimir Putin authorised a military operation in eastern Ukraine.

In a tweet, Ukrainian foreign minister Dmytro Kuleba said Russia has launched a full-scale invasion of Ukraine and is targeting cities with weapons strikes.

Gold has risen about 8% in February so far and is set for its best monthly gain since July 2020.

“Gold is coming back into its own as a haven asset and I do not rule out new all-time highs in prices in the weeks ahead,” Jeffrey Halley, a senior market analyst at Oanda, said in a note.

Global stocks and US bond yields dived, while the dollar and oil prices rocketed higher.

“Any sanctions the West puts in place aren’t really going to affect Russia in the way the West is hoping … the West is on the back foot here and that’s another good reason why gold is rising because it’s a true risk-off environment,” said Matt Simpson, senior market analyst at City Index.

Spot silver gained 1.6% to $24.91/oz, platinum rose 0.5% to $1,097.01 and palladium jumped 2% to $2,530.42. 

Reuters