Tags: Gold | High | Ukraine | Crisis

Gold Reaches Six-Month High on Ukraine Crisis

Thursday, 13 Mar 2014 06:29 PM

Gold futures edged up to a six-month high Thursday on concern that tension between Russia and Ukraine may escalate, spurring demand for the precious metal as a store of value.

Shots were fired near the Ukraine border by a Russian armored vehicle when a Ukrainian Border Service patrol plane was inspecting the area, Ukraine said in a statement on its website. Russia, which may “integrate” Ukraine’s Crimean region after a referendum, has rejected attempts to de-escalate the crisis, German Foreign Minister Frank-Walter Steinmeier said. A gauge of global equities fell for a fifth session, the longest losing streak since November 2012.

“The Ukraine situation is still very volatile, so any news out of there could push gold higher,” Alfonso Esparza, senior currency analyst in Toronto at Oanda Corp., said in a telephone interview. “We are seeing people move toward the risk-averse instruments like gold in the uncertain environment.”

Gold futures for April delivery gained 0.1 percent to settle at $1,372.40 an ounce at 1:42 p.m. on the Comex in New York. Earlier, the price reached $1,375.70, the highest for a most-active contract since Sept. 10. Trading was 48 percent above the average for the past 100 days for this time, data compiled by Bloomberg showed.

China’s retail sales, industrial output and investment last month trailed estimates, data showed Thursday. The MSCI All-Country World Index of shares fell as much as 0.8 percent.

‘Correction Potential’

“Amid concerns about the Chinese economy and the geopolitical tensions between Russia and Ukraine, gold is clearly still in demand as a safe haven,” analysts at Commerzbank AG said in a report. There’s “correction potential” for the metal because the rally has been “driven by speculation,” the bank said.

Prices fell as much as 0.4 percent Thursday, before erasing losses.

Last year, gold slumped 28 percent, the most since 1981, amid a U.S. equity rally to a record, muted inflation and speculation that the Federal Reserve would taper monetary stimulus.

Silver futures for May delivery dropped 0.7 percent to $21.198 an ounce on the Comex.

On the New York Mercantile Exchange, platinum futures for April delivery rose 0.2 percent to $1,479.40 an ounce.

Palladium futures for June delivery gained 0.2 percent to $778.95 an ounce. Russia is the world’s biggest source of the metal.

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Gold futures edged up to a six-month high Thursday on concern that tension between Russia and Ukraine may escalate, spurring demand for the precious metal as a store of value.
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2014-29-13
Thursday, 13 Mar 2014 06:29 PM
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