Gold prices on Wednesday climbed more than 1% to their highest since early February, as the Credit Suisse crisis drove investors away from riskier assets and into the safety of the yellow metal.
Spot gold prices climbed 1.2% to $1,924.63 an ounce at 1556 GMT. In the US, gold futures closed at $ 1,931.30, up 1.1%.
Renewed panic gripped world markets and Europe’s bank stocks came under pressure after Credit Suisse’s biggest investor said it may not provide more financial support to the Swiss bank.
“It’s a total safe-haven trade,” said Philipp Streibel, chief market strategist at Blue Line Futures in Chicago. There’s a lot of concern about Credit Suisse and now European banks are really coming under a lot of pressure. So it’s a complete flight. . For security.”
“People are moving into US Treasuries, gold, silver and the dollar. They are moving out of riskier assets such as US equities and economically sensitive metals such as copper, platinum and palladium,” said Streibel Furtehr.
Spot silver rose 0.6% to $21.82 an ounce. Platinum fell 2.4% to $958.76 and palladium fell 3.1% to $1,459.79.
Gold has traditionally been viewed as a hedge against inflation, but when interest rates are raised to reduce inflation, the opportunity cost of holding a non-yielding asset increases.
The overall focus was still on the Federal Reserve’s next move on interest rates as it assesses data showing elevated inflation in February against the backdrop of the collapse of two regional banks.
Markets gave a 57.1% chance of the Fed keeping its benchmark rate at current levels at its March 21-22 policy meeting.
Know your inner investor
Do you have guts of steel or are you a victim of insomnia regarding your investments? Let’s define your investment approach.
catch all commodity news And updates on Live Mint. download mint news app To get daily market update & Live business News,