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By Bharat Gautam
(Reuters) – Gold prices fell on Wednesday as the US dollar consolidated at its highest level in more than two years and pressured demand for greenback-priced bullion.
was down 0.4% at $ 1,897.86 per ounce, as of 0612 GMT. US slid 0.3% to $ 1,898.80.
“So, $ 1,900 is clearly a pivotal level for today’s session … looking further out, it’s not looking ideal at the moment with the US dollar at a 25-month high,” trading firm City Index’s senior market analyst Matt Simpson said.
The dollar stood at its highest level since the early days of the pandemic and was heading for its best month since 2015, supported by the prospect of aggressive US rate hikes and on safe-haven flows fanned by slowing growth in China and Europe. [USD/]
A stronger dollar makes greenback-priced gold less attractive to other currency holders. The greenback is also seen as a rival safe-haven asset to gold during economic and political crises.
Headlines from Russia provided some support to gold on Tuesday as investors sought a safe haven, but the Ukraine crisis has not been as much of a bullish story recently for bullion as it was a few weeks ago, and demand from it is unlikely to last through the week, Simpson said.
Russian gas supplies to Poland were halted briefly on Wednesday, data from the European Union gas transmission operators showed, raising fears Russia may turn off the gas taps to Ukraine’s allies in what it calls “gas blackmail”.
Most Asian stock indices fell as growing fears over the global economy drove investors to dump riskier assets in favor of safe havens such as the US dollar and government bonds. [MKTS/GLOB]
Spot silver gained 0.2% to $ 23.53 per ounce, platinum dipped 0.1% to $ 920.23, and palladium firmed 0.6% to $ 2,200.40.
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