Singapore/Manchester: Gold held gains after talks between Ukraine and Russia failed to make progress in halting the war.
Russia indicated it will continue attacks until its goals are met, Ukrainian Foreign Minister Dmytro Kuleba said after the meeting lasting about 90 minutes with his Russian counterpart Sergei Lavrov in Turkey on Thursday.
Gold, alongside various other commodities such as oil and wheat, have fallen from recent highs, although concerns remain over the threat of an inflationary shock to the global economy just as the Federal Reserve prepares to raise interest rates. U.S. inflation accelerated to a fresh 40-year high in February, prior to the recent spike in energy prices.
“Investors will continue to buy gold as an inflation hedge,” Georgette Boele, a senior precious metals strategist at ABN Amro Bank NV, wrote in a note. “But as the Fed will continue to hike and we also expect a higher dollar, gold’s fortunes will mainly be positive versus other currencies than the dollar.”
The Dutch lender expects gold prices to trade at $2,000 an ounce at the end of 2022 and 2023.
Spot gold added 0.2% to $1,996.10 an ounce at 4:32 p.m. in New York after dropping 2.9% Wednesday, the most since January 2021. Prices touched $2,070.44 on Tuesday, just $5 short of an all-time high reached in August 2020. Bullion for April delivery rose 0.6% to settle at $2,000.40 on the Comex. The Bloomberg Dollar Spot Index was up 0.4% after declining 0.9% in the previous session. Palladium and platinum fell, while silver gained. –Bloomberg