Gold steady despite rising yields

Gold prices remained firm overall on Thursday, as the dollar continued falling but treasury yields rose. Rising treasury yields put pressure on the price of gold, which becomes less appealing as an asset, as it does not pay dividends or interest. On the other hand, the weakening dollar supports gold prices, as traders adjust their expectations of future Federal Reserve rate hikes. 

Mounting tensions between Russia and Ukraine also help to keep the price of gold up, as investors turn to safe-haven assets. Russian President Vladimir Putin stated on Tuesday that Russia does not plan to attack Ukraine, and accused the US of using Ukraine as a tool to contain Russia. Diplomatic talks continue though, and if the situation is resolved peacefully, gold price might drop. 

Gold price exhibited some volatility on Thursday, plummeting to $1,788 per ounce, but rebounded immediately to $1,804 per ounce. For most of the day the price of the commodity stayed above the key $1,800 per ounce level. If the price of gold rises again, it may find resistance at $1,829 per ounce and further up at $1,853 per ounce, while if the price of gold decreases further, support may be found at 1,782 per ounce. This week, the gold price is expected to show some volatility, due to mounting tensions between Russia and Ukraine. 

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Written by:
Myrsini Giannouli

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