Gold prices edged higher on Thursday (March 10) with the yellow metal bouncing above the $2,000 an ounce level after reports suggested that negotiations between Russia and Ukraine in Turkey yielded no tangible results.
Spot gold rose 0.7% to $2,004.89 per ounce by 1203 GMT while U.S. gold futures were up 1.2% to $2,011.00. Spot silver rose 0.7% to $25.92 per ounce, while platinum added 1.7% to $1,094.31 according to Reuters.
“The safe-haven allure for gold is maintained despite the markets assimilation with commodity supply shocks and will be a driving force for bullion as the war in Ukraine persists,” DailyFX analyst Warren Venketas wrote in a note.
High-level talks between Russia and Ukraine got under way near Antalya Ukraine’s foreign minister, Dmytro Kuleba, said there had been no progress to achieving a ceasefire.
For his part, Russian Foreign Minister Serghei Lavrov said Russia would not have started the conflict in Ukraine if the West had not rejected “our proposal on security guarantees“.
“Until the end, we wanted to resolve the situation in Ukraine through diplomatic means,” the top diplomat said.
As precious metals, most notably gold and silver, are seen by many as inflation hedges, the traders also monitor the report on consumer prices in the United States.
Annual inflation rate accelerated to 7.9% in February, the highest since January of 1982, Labor Department data showed Thursday. Rising gasoline, food and housing costs drove the gains. The US and other parts of the world have already been grappling with high inflation for months.
As oil and commodity market disruptions from the Ukraine crisis are expected to add more cost pressures investors remain concerned over the threat of an inflationary shock to the global economy.
In addition to the conflict between Russia and Ukraine, the expected interest rate hikes by the U.S. Federal Reserve this month may also put extra pressure on the gold prices.