Gold Down, but Near Eight-Month High as Ukraine Tensions Remain High

© Reuters.

By Gina Lee

Investing.com – Gold was down on Monday morning in Asia but was near its highest level in more than eight months as mounting geopolitical tensions over Ukraine drive investors towards safe-haven assets.

Gold futures inched down 0.01% to $1,899.65 by 10:02 PM ET (3:02 AM GMT).

The yellow metal has just come off three consecutive weeks of gains, driven by growing concerns of a Russian invasion of Ukraine. The U.S. warned that an invasion could potentially involve multiple cities in Ukraine including the capital city Kyiv.

U.S. President Joe Biden said on Friday that an invasion could come “within days”, an accusation that Russia continues to refute. Russian Foreign Minister Sergei Lavrov will meet U.S. Secretary of State Antony Blinken later in the week in Europe, while Biden and Russian President Vladimir Putin have also reportedly agreed “in principle” to a summit.

The move towards safe havens has over-ridden concerns about a potential interest rate hike from the U.S. Federal Reserve. Fed Governor Lael Brainard and New York Fed President John Williams, as well as Chicago Fed President Charles Evans, said during the previous week that they were eager to start hiking rates. However, they were not seeking a super-sized hike or a move before the central bank’s next scheduled meeting.

Meanwhile, Fed Governor Michelle Bowman will speak later in the day, and her colleagues, including Loretta Mester and Raphael Bostic, will speak on Thursday.

In other central bank news, the People’s Bank of China’s loan prime rates are due later in the day. The Reserve Bank of New Zealand will hand down its policy decision on Wednesday, with Bank of England Governor Andrew Bailey appearing before the Treasury Committee the same day. The Bank of Korea will hand down its policy decision on Thursday.

In other precious metals, silver, palladium, and platinum were all on an upward trend.