Gold futures closed higher on Tuesday (Jan. 25) than they have in more than two months, as tensions in Ukraine continued to drive investors to buy gold as a safe haven. The fall of the U.S. stock market and the downgrade of forecasts for the global economy by the IMF are also important factors.
- Gold futures were up $10.8, or 0.6%, at $1,852.50 per ounce.
- Silver futures were up 9.6 cents, or 0.4%, at $23.896 an ounce.
- Platinum was up $5.2, or 0.51%, at $1,025.5 per ounce.
- The palladium futures rose $47.90, or 2.2%, at $2,188.90 an ounce.
Investors continue to buy gold as a safe haven. After the tense situation in Ukraine tends to worsen. There is no progress in the negotiations between Russia and the West to settle the Ukraine conflict. President Biden has already announced that troops are on standby to go to Ukraine.
The decline in the U.S. equity markets continues. Especially the NASDAQ is visibly hit by the current market sentiment, almost 14% in the minus YTD. Likewise, the S&P500 does not look better with -8.6% YTD.
In addition, the IMF is lowering its global economic forecasts. This is another factor supporting safe-haven purchases.
The IMF expects the global economy to grow by 4.4% in 2022. The previous forecast of 4.9% was reduced due to the impact of the coronavirus pandemic, supply chain bottlenecks and rising inflation.
In Asia, the Chinese economy is expected to grow by 4.8% this year, compared with 5.6% last year, due to the effects of the zero interest rate policy and problems in the real estate sector.
Investors are paying attention to the results of the Fed meeting, which will be announced tonight (Asia time GMT+7).
The Spot Market is Open
Wednesday, January 26, 2022