Gold hovers near 1-week peak amid Russia-Ukraine tensions

Wed Nov 20 2024

Gold prices lingered near a one-week peak on Wednesday as heightened tensions between Russia and Ukraine sparked safe-haven demand, while cues on the US interest rate path were also in focus.

• Spot gold was up 0.2% at $2,635.97 per ounce by 0010 GMT after hitting its highest since Nov. 11 in the previous session. * US gold futures rose 0.3% to $2,638.80.
• Ukraine used US ATACMS missiles to strike Russian territory on Tuesday, taking advantage of newly granted permission from the outgoing administration of US President Joe Biden on the war’s 1,000th day.
• Bullion is known as a safe asset amid geopolitical turmoil and thrives in a low interest rate environment.
• Traders currently see a 57% chance of a 25-basis-point cut in December. Recent strong data and US President-elect Donald Trump’s proposed tariffs have sparked prospects that rates might need to stay higher for longer.
• Americans see inflation as the leading issue Trump should tackle during his first 100 days in office, according to a Reuters/Ipsos poll.
• It remains uncertain how far interest rates can fall, though the initial reductions made by the US central bank are a vote of confidence that inflation is returning to its 2% target, Kansas City Fed President Jeffrey Schmid said.
• Elsewhere, ECB policymaker Fabio Panetta said the European central bank should cut interest rates so they no longer curb economic growth.
• Spot silver gained 0.3% to $31.29 per ounce, platinum steadied at $973.90 and palladium edged 0.3% down to $1,031.64.

Source: http://in.reuters.com