Gold Prices Reach One-Week High Amid Geopolitical Tensions
Surge driven by Russia-Ukraine conflict and softer US dollar
Gold prices climbed to a one-week high on Wednesday, driven by increased investments in safe-haven assets due to the ongoing Russia-Ukraine conflict and a weakening US dollar.
The value of gold approached the resistance level of $2,640-$2,650 per ounce as the dollar's recent rally paused, making gold more appealing to international buyers.
The SPDR Gold Trust, the largest global gold fund, reported an increase of 0.58 tonnes in its gold holdings, reaching a total of 872.2 tonnes.
This uptick comes as global tensions rise following Russian President Vladimir Putin's decision to lower the nuclear strike threshold in response to US-supported Ukrainian military advancements.
Domestically, the Gold Traders Association reported that gold was trading at 43,100 baht per baht weight by midday.
Local specialists like MTS Gold and Hua Seng Heng Gold Futures predict limited upside for gold prices unless new factors emerge to drive further gains.
In the US, speculation around Federal Reserve interest rate adjustments adds complexity, as higher rates may decrease gold's allure.
Traders currently estimate a 58.9% likelihood of a 25-basis-point Fed rate cut in December, influenced by inflation concerns.