Gold Price Forecast: XAU/USD to stay in demand as a safe-haven amid escalating geopolitical tensions – Commerzbank
The gold price surged to $1,930 as trading began this morning. It dropped back later to dip below the $1,900 mark again, however. As strategists at Commerzbank note, escalation of the Russia-Ukraine conflict generates high demand for the yellow metal.
Russian President Putin put deterrence forces at the highest threat level
“The US and the EU have imposed further – and this time tougher – sanctions on Russia. Not only have a number of commercial banks been excluded from the SWIFT payment system, but sanctions have now also been imposed directly on the Russian central bank.”
“Russian President Putin has threatened the West with weapons of deterrence and put the country’s nuclear forces on high alert. And last but not least, the fighting in Ukraine persists. All of this is cause for concern and is prompting price fluctuations on the markets accordingly.”
“Gold is in demand as a safe haven in this environment, as is also evident from the ETF inflows. Besides ETF investors, we believe that speculative financial investors amplified the upswing in the gold price.”
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FXStreet Insights Team
FXStreet
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