Gold rises, dollar, yields fall amid progress in Russia-Ukraine talks
- Spot gold was up 0.3% to $1,923.95 per ounce while gold futures in the US climbed 0.5% to $1,927.70
- Benchmark 10-year yields in the US have also fallen from near three-year highs
- Spot silver was up 0.1% to $24.78 per ounce, while platinum was up 0.9% to $991.49
Gold prices increased on Wednesday, aided by a drop in the US dollar and Treasury yields, but reports of progress in Russia-Ukraine peace negotiations reduced the metal’s attractiveness as a safe haven.
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Spot gold was up 0.3% to $1,923.95 per ounce. Gold futures in the United States climbed 0.5% to $1,927.70. On Tuesday, the metal plummeted as much as 1.8% to its lowest level since February 28 at $1,889.45.
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“(Weaker) dollar has provided a level of support for gold…bond prices bounced from a key level of support yesterday which helped push yields lower despite the supposed risk-on rally seen across equities. And that’s provided with another pillar of support for gold,” City Index senior market analyst Matt Simpson said.
Underpinning gold, investors remain wary about Russia’s true intentions over its pledge to scale down ‘military operations’, he added.
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Ukraine responded sceptically to Russia’s assurance to reduce military operations near Kyiv and another city, as several Western countries expected Moscow to escalate its onslaught in other regions of the country.
In the previous session, the dollar index fell to a more than one-week low, making gold less expensive for holders of other currencies.
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Benchmark 10-year yields in the United States have also fallen from near three-year highs, and lower yields reduce the opportunity cost of storing non-yielding bullion.
The SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, saw its holdings fall 0.2% to 1,091.44 tonnes on Tuesday.
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Spot silver was up 0.1% to $24.78 per ounce, while platinum was up 0.9% to $991.49.
Palladium rose 1.5% to $2,182.15, after falling to a two-month low of $2,032.97 in the previous session.
Since reaching an all-time high on March 7, the auto-catalyst metal has dropped nearly 40% as supply fears from Russia have subsided.
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