Gold prices remained steady on Wednesday as worries about the Ukraine crisis push demand for safe-haven assets, and Fed officials calls for sharper interest rate hikes aimed at keeping inflation in check.
“Potential for higher interest rates globally is weighing on (gold). At the same time, the desire for safe havens in the face of the geopolitical conflict in Ukraine is supportive”, Michael McCarthy – chief strategy officer at Tiger Brokers, Australia, commented.
Indeed, optimism around a quick Ukraine resolution is starting to fade. The West plans to announce more sanctions against Russia amid a worsening humanitarian crisis.
Meanwhile, St. Louis Fed President – James Bullard called for the central bank to raise its benchmark overnight interest rate to 3% this year to keep inflation under control.
Spot gold was little changed Wednesday at $1,920.84 per ounce by 05.58 GMT. U.S. gold futures were flat at $1,921.30.
Looking into the future, according to Reuters' technical analyst Wang Tao – spot gold may fall into a range of $1,891-$1,903 per ounce, as the downtrend from the March 8 high of $2,069.89 seems to have continued.
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