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Thursday, February 17, 2022 - 13:26:37
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Mining News Pro - Gold prices rose on Wednesday as concerns over the Russia-Ukraine situation lingered on, and as markets looked forward to minutes from the Federal Reserve’s last policy meeting.
Spot gold saw a 0.6% gain to $1,865.72 per ounce by noon ET, its highest since June 2021. US gold futures were also up 0.6%, trading at $1,866.60 an ounce in New York.
“Gold is attracting a wide range of investors that are looking for protection as they are realizing that there’s not going to be a quick resolution to this (Russian-Ukraine) situation,” Edward Moya, senior market analyst at brokerage OANDA, told Reuters.
“Gold has a clear path higher. However, it will have some moments where it will sell off because of more aggressive Fed tightening expectations,” Moya added.
US Secretary of State Antony Blinken stated earlier that Russia has been moving critical units closer to Ukraine’s border on Wednesday, despite Moscow’s insistence it was pulling back.
Rising geopolitical tensions and expectations surrounding a US rate hike weighed on sentiment in financial markets, driving investors to seek havens like bullion.
Investors now await the Fed minutes of its January 25-26 policy meeting due at 2 p.m. ET, which are expected to shed more light on policymakers’ plans to hike interest rates.
The US central bank will kick off its tightening cycle in March with a 25 basis-point interest rate hike, a Reuters poll found.
“Once the Fed starts raising rates and…if it’s faster than expected you’ll see gold dropping, but I don’t see a collapse,” said Bernard Dahdah analyst at Natixis, adding that prices could then drop towards $1,700 and high-$1,600 range.
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