Gold futures climbed on Thursday, with the precious metal getting a boost as Russia ratchets up its war effort in Ukraine.
Strength in the dollar in the wake of the Federal Reserve’s third 75 basis-point interest-rate hike, however, has capped gold’s rise.
- Gold for December delivery GCZ22, +0.26% was up $3.90, or 0.2%, to $1,679.60 per ounce on Comex.
- December silver SIZ22, +0.36% rose 4.5 cents, or 0.3%, to $19.525 per ounce after a nearly 1.6% rise Wednesday.
- December palladium PAZ22, +2.85% rose $49, or 2.3%, to $2,172.50 per ounce, while October platinum PLV22, -0.31% fell $2.40, or 0.3%, to $913.60 per ounce.
- December copper HGZ22, +0.20% rose by a penny, or 0.3%, to $3.4775 per pound.
What analysts are saying
Geopolitical tensions in Russia — as Russian President Vladimir Putin calls up reservists and re-ups his nuclear rhetoric — provided support to haven gold on Thursday.
Strength in the dollar, however, with the ICE U.S. Dollar Index DXY, +0.68%, a gauge of the dollar’s strength against a basket of rivals, at its strongest level in more than 20 years, has limited the gains for gold. The index was up 0.5% to 111.20 on Thursday.
Gold looks “like it wishes to regain” the $1,700 an ounce level here, Peter Spina, president of GoldSeek.com, told MarketWatch.
“News from Russia of [a] partial mobilization and a move to a war stance in Ukraine from a special military operation” supported gold prices on Wednesday, said Spina. “Fears, uncertainties and an escalation of events in Ukraine will underpin gold here.”
But “silver is really show resiliency here, with “very strong demand under $20 an ounce,” said Spina. Momentum and buying interest is likely propel silver back above this mark soon, he said.
Also, the fact that the Fed opted not to deliver the 100 basis-point interest-rate hike that some had anticipated was helping keep gold from substantially weakening, said Naeem Aslam, chief market analyst at AvaTrade.
Still, with the dollar on the rise, “the path of the least resistance for gold prices is highly skewed to the downside,” Aslam said.
In Treasury trading, the 2-year yield TMUBMUSD02Y, 4.156% has now climbed solidly north of 4%, seen as a level that could unleash stress across markets. The yield has reached its highest level since late 2007.