Commodities hit multi-year high
Gold headed for its biggest weekly gain since late 2020 as the war in Ukraine fueled demand for haven assets.
Investors are assessing the economic fallout from Russia’s invasion of its neighbor, which is disrupting flows of energy, grains and metals. The resulting surge in oil prices has stoked concerns about global growth and inflation risks.
Investors have sought out bullion amid the uncertainty, with holdings in exchange-traded funds backed by the metal climbing to the highest since March. Gold prices extended gains Friday after a U.S. job report that showed wage growth slowed even as hiring boomed last month. The figures may offer some respite from strong inflationary pressures as the Federal Reserve gets set to raise interest rates.
The metal “is in a sweet spot for the time being as traders certainly want to have exposure to gold given the war situation in Ukraine,” said Naeem Aslam, chief market analyst at Ava Trade. Still, the jobs data “has confirmed that the Fed has the green light to increase the interest rate and this is likely to keep the gold price on a tight leash.”
Spot gold rose 1.3 per cent to US$1,960.84 an ounce at 11:20 a.m. in New York. A close at that price would mark a 3.8 per cent weekly gain, the biggest since November 2020. Palladium rose 5.8 per cent, bringing this week’s gain to about 24 per cent, on concerns over potential supply disruptions. Russia produces about 40 per cent of the metal mined globally. Silver and platinum edged higher.