Gold clears $1,900/oz level as Ukraine standoff intensifies

Feb 18: Gold prices on Friday were at their highest since June 2021 as mounting tensions between Russia and the West over Ukraine lifted bullion‘s safe-haven appeal, buttressed by lower U.S. bond yields.

FUNDAMENTALS


* Spot gold rose 0.3% to $1,902.20 per ounce, as of 0033 GMT, its highest in eight months. U.S. gold futures added 0.1% to $1,904.30.

* Safe-haven debt rose on Thursday after U.S. President Joe Biden said there was every indication Russia planned to attack Ukraine, while Moscow accused Washington of ignoring its security demands.

* 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 U.S. and allies offer arms control and confidence-building measures.

* While Russia accuses the West of hysteria, many Western countries are adamant that the military build-up is continuing ahead of a possible assault.

* On Thursday, gold prices rose as much as 1.8%, breaking past $1,900/oz for the first time since June 11, 2021, with analysts expecting a further rally if tensions continue to escalate.

* Spot gold is now set for a third straight weekly gain, having added about 2.2% so far.

* A dip in Benchmark U.S. 10-year Treasury yields decreased the opportunity cost of holding non-interest-paying bullion.

* Elsewhere, Japan’s core consumer prices rose for a fifth straight month in January, but at a slower pace than in the previous month.

* Spot silver was up 0.2% at $23.86 per ounce and palladium rose 0.8% to $2,385.08, with both set for weekly gains of about 1.3% and 3.4% respectively.

* Platinum gained 0.5% to $1,094.83, its highest since mid-November, setting up its best weekly showing since June.

DATA/EVENTS (GMT) 0700 UK Retail Sales MM, YY Jan 0700 UK Retail Sales Ex-Fuel MM Jan 0745 France CPI (EU Norm) Final MM, YY Jan 1500 EU Consumer Confid. Flash Feb 1500 US Existing Home Sales Jan