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BookmarkGold climbed in New York, after reaching a 17-week high yesterday, on speculation that investor demand for haven assets will increase amid unrest in Ukraine.
Gold is heading for a second month of gains, the longest such run since August, as concern that the U.S. recovery may be faltering and unrest in emerging markets boosted demand for a store of value. Gunmen occupied Ukraine’s Crimea regional parliament and raised the Russian flag as lawmakers in the capital meet to approve a new cabinet after last week’s ouster of Viktor Yanukovych as leader.
“Heightened geopolitical risks as tensions in the Ukraine mount are supportive of gold,” James Steel, an analyst at HSBC Securities (USA) Inc., wrote in a note. “Should events in Ukraine deteriorate and involve neighboring countries, gold could benefit from increased safe-haven demand.”
Gold for April delivery added 0.3 percent to $1,332.50 an ounce on the Comex in New York by 8:30 a.m., after climbing to as much as $1,345.60 yesterday, the highest for a most-active contract since Oct. 30. Futures trading volumes were about the average for the past 100 days for this time of day, according to data compiled by Bloomberg. Gold for immediate delivery was little changed at $1,331 in London.
Bullion has gained 11 percent this year, rebounding from the biggest annual decline in more than three decades, even as the U.S. Federal Reserve announced a reduction to asset purchases at its past two meetings.
Assets in the SPDR Gold Trust, the biggest bullion-backed exchange-traded product, were unchanged yesterday after gaining for three days, and are heading for the first monthly expansion since December 2012 on haven demand. Russian President Vladimir Putin ordered military exercises amid deepening tensions in Ukraine, where lawmakers are set to approve Arseniy Yatsenyuk as prime minister today after a three-month uprising that culminated in last week’s ouster of Yanukovych.
Chinese Demand
In China, the largest consumer, volumes for the benchmark contract on the Shanghai Gold Exchange declined yesterday from a two-week high on Feb. 25 as metal for immediate delivery traded at a premium to London prices for the first time in five days.
Silver for delivery in May was little changed at $21.30 in New York, rising 11 percent in February to snap three months of losses. Platinum for April delivery rose 1 percent to $1,443 an ounce. Palladium for June delivery gained 1.1 percent to $741.10 an ounce.
