Gold recovers from two-week low on persistent safe-haven appetite
Gold prices rebounded on Tuesday from the previous session's near two-week low, as buyers of the safe-haven metal returned following a brief spell of profit-taking.
Spot gold was up 1% at $4,374.76 per ounce at 0917 GMT. On Monday it posted its biggest daily percentage loss in more than two months in a retreat from Friday's record high of $4,549.71 to its lowest since December 17.
U.S. gold futures for February delivery were up 1.1% at $4,391.30/oz.
"The selloff yesterday had the hallmarks of profit taking and repositioning ahead of the New Year....buyers are likely returning as the structural conditions of this rally - a weaker U.S. dollar and ongoing geopolitical uncertainty - still remain," said Zain Vawda, analyst at MarketPulse by OANDA.
Bullion has climbed 66% this year, its biggest annual gain since 1979, fuelled by monetary easing, geopolitical tensions, central bank buying and rising holdings in exchange-traded funds.
The Federal Reserve will release minutes of its December meeting later on Tuesday, which are expected to show divisions inside the central bank on the trajectory of monetary policy next year.
Traders are currently pricing in two rate cuts next year. Non-yielding assets tend to do well in a low interest rate environment.
On the geopolitical front, Russia accused Ukraine on Monday of trying to attack President Vladimir Putin's residence and vowed retaliation, denting prospects for a peace deal.
Spot silver was up 3.3% at $74.61 per ounce. It hit an all-time high of $83.62 in the previous session before logging its biggest daily loss since August 2020.
Silver has surged 159% this year, driven by its inclusion on the U.S. critical minerals list, supply deficits and growing industrial and investor appetite.
"Gold will need to solidify its hold above the $4,000/oz threshold for bullish momentum to remain in play, while silver's next major test will be holding above the psychological $50/oz handle before reclaiming the $80/oz level," Vawda said.
Spot platinum rose 3.5% to $2,182.30 per ounce. It also touched a record high on Monday, of $2,478.50, before logging its biggest-ever one-day drop.
Palladium rose 1% to $1,632.56 per ounce, after falling 16% on Monday.
Source: Reuters.com
