Gold Stabilizes amid Hawkish Fed and Ukraine-Russia Crisis

Gold prices stabilized on Wednesday as Ukraine-Russia tensions spur demand for safe-haven assets even as the U.S. Federal Reserve looks to implement additional interest rate hikes this year to counter soaring inflation.

According to Reuters, spot gold remained largely unchanged at $1,920.84 per ounce by 0558 GMT. U.S. gold futures stayed the same at $1,921.30.

Tiger Brokers Australia’s Chief Strategy Officer, Michael McCarthy said, "Potential for higher interest rates globally is weighing on (gold). At the same time, the desire for safe havens in the face of the geopolitical conflict in Ukraine is supportive."

St. Louis Fed Chief Josh Bullard has urged the central bank to raise the overnight interest rate by 3% while adopting a more hawkish outlook to control surging pandemic-induced inflation. Market analysts are anticipating a 72.2% chance of the Fed increasing the fund rates by 50 basis points in May.

Spot silver and palladium edged higher by 0.2% and 2.9% to $24.79 per ounce and $2,556.19 respectively, while platinum dropped by 0.4% to $1,018.82.