Gold headed for its biggest weekly gain since May as demand for safe-haven assets surged as Russia escalated the conflict in Ukraine. Meanwhile, Federal Reserve Chairman Jerome Powell, who made a statement yesterday, said that the Fed is on the way to increase interest rates and will act cautiously. Spot gold prices rose by 0.45% on a daily basis to $1,944.7 at the time of writing, with the effect of these developments reducing the risk appetite and directing investors to safe havens. U.S. gold futures were trading at $1,948.9, up 0.68%.
Investors are looking for yellow metal as a store of value amid uncertainty
cryptocoin.com As we reported, precious metals prices soared on the back of lower Treasury yields after earlier reports of Russia’s attack on Europe’s largest nuclear power plant escalated. Investors are weighing the economic repercussions of Russia’s invasion of its neighbor, which has disrupted energy, grain and metal flows. The rise in oil prices increased concerns about global growth and inflation risks.
Investors are looking for bullion as a store of value amid uncertainty, with inflows to around 34 tonnes of metal-backed exchange-traded funds so far this week, according to preliminary data compiled by Bloomberg. Traders are also assessing the possibility of monetary policy tightening as they await a key monthly US jobs report due Friday.
Daniel Briesemann: Labor data won’t have significant impact on gold this time
Federal Reserve Chairman Jerome Powell reiterated that the U.S. central bank is on track to raise interest rates this month, and a series of hikes is planned to rein in the highest inflation in decades, although it is thought it will act “with caution” over Russia’s invasion of Ukraine. Commerzbank AG analyst Daniel Briesemann underlines the following in a note:
Given the recent words of Fed Chairman Jerome Powell, we have no doubt that the US Fed will raise interest rates next week. Labor market data is unlikely to have a significant impact on the gold price this time around.
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