The price of gold rose for the third time in a row to its highest level in a week on Wednesday, boosted by a weaker dollar and escalating tensions between Russia and Ukraine that increased demand for gold. safe assets.
Spot gold rose 0.32% to $2,640.19 an ounce at 0323 GMT, its highest level since November 11. U.S. gold futures rose 0.5% to $2,643.70.
The U.S. dollar's rise stalled after hitting a one-year high last week, making bullion more attractive to buyers holding other currencies. [USD/]
Russian President Vladimir Putin lowered the threshold for launching a nuclear strike in response to a broader range of conventional attacks, days after Washington authorized Ukraine to use U.S.-made weapons to strike deeply Russia.
“The U.S. authorization and Russian response, which could lead to the use of a tactical nuclear weapon, contributes to market uncertainty and boosts safe-haven assets like gold […]. On the upside, the key resistance to watch is around $2,700,” said Ilya Spivak, head of global macro at Tastylive.
In addition, several Federal Reserve officials are expected this week to provide clarification on the trajectory of interest rate reductions in the United States.
Currently, traders estimate a 58.9% chance of a 25 basis point cut in December. Strong recent data and President-elect Donald Trump's proposed tariffs suggest rates will remain high for longer.
The market is adjusting its expectations for Fed cuts next year as inflation becomes a bigger concern, which could be negative for gold, Spivak added.
Higher rates reduce the attractiveness of gold without yield.
Separately, Jeffrey Schmid, president of the Kansas City Fed, said it was not certain that rates could fall, even if the first cuts made by the American central bank constitute a vote of confidence in the return of inflation to its target of 2%.
Spot silver was flat at 31.22 an ounce, platinum rose 0.1 percent to $975.10 from $973.90 and palladium was flat at $1,035.43.
