Gold futures traded more than 1% lower on Friday as comments from Russian President Vladimir Putin dulled haven demand for precious metals, still the metal was looking at a modest weekly gain.
“There are certain positive shifts, negotiators on our side tell me,” Reuters quoted Putin as saying, in a meeting with Alexander Lukashenko, the president of Belarus.
The Russia president’s remarks come even as Moscow’s siege of Kyiv enters a third week and has widened its bombing campaign into western Ukraine.
“The geopolitical risk premium in gold fades reasonably quickly,” wrote Stephen Innes Managing Partner at SPI Asset Management, in a Friday note. However, the “great unknown this time is the longer-term impact of higher commodity prices,” as sanctions on Russia could further disrupt supply chains.
April gold
GCJ22,
was trading $26.10, or 1.3%, to $1,974.30 an ounce, after gaining 0.6% on Thursday. Friday’s downdraft comes after futures
GC00,
settled Tuesday at $2,043.30, their highest in about 19 months—teasing a record settlement high of $2,069.40 from Aug. 6, 2020.
So far, prices for the most-active contract was clinging to a 0.4% weekly rise, FactSet data show.
May silver
SIK22,
also declined by 17.6 cents, or 0.7%, to $26.08 an ounce, eying a weekly advance of 1.2%.
“It has been another explosively volatile week for gold as the risk pendulum swings back and forth,” Lukman Otunuga. manager, market analysis at FXTM, told MarketWatch. “The precious metal remains highly sensitive to geopolitical uncertainty concerning Ukraine, while other themes in the form of rising inflation and growth concerns had added to the volatility.”
Overall, analysts are anticipating that gold will maintain a bullish, albeit volatile, trend, as rising U.S. and E.U. inflation continues to weigh on investors’ minds and fears grow that price pressures haven’t yet peaked.
The U.S. consumer-price index hit a 7.9% annual rate in February, according to data released on Thursday, with the surge in the cost of living in the past 12 months the biggest since January 1982. The consumer-price index rose 0.8% in the month. The data doesn’t yet reflect the impact of higher prices from the war in Ukraine that is disrupting supplies of oil, metals and grains.
In other Comex trading, May copper
HGK22,
shed 0.5% to $4.63 an ounce, trading more than 6% lower for the week. April platinum
PLJ22,
lost 1% to $1,083.90 an ounce, poised for a weekly loss of around 3%.
June palladium
PAM22,
traded at $2,758 an ounce, down 5.6% in Friday dealings, and down 7.5% for the week. Prices settled at a record high on March 4.
