Gold eases as dollar holds firm on safe-haven flows

[BENGALURU] Gold inched lower on Tuesday (Apr 5) as the US dollar held firm on rising prospects of more Russian sanctions, and bigger interest-rate hikes by the Federal Reserve to rein in inflation.

Spot gold was down 0.2 per cent at US$1,929.60 per ounce by 2.03 am GMT. US gold futures were flat at US$1,933.60.

The dollar index was unchanged after 3 straight sessions of gains as talks of further sanctions against Moscow increased. A stronger dollar makes gold less attractive for other currency holders.

The United States and Europe were planning new sanctions to punish Moscow over civilian killings in Ukraine, and President Volodymyr Zelensky warned more deaths were likely to be uncovered in areas seized from Russian invaders.

US 2-year Treasury yields climbed to their highest level since early-2019 and 10-year yields ticked higher on Monday. Higher yields increase the opportunity cost of holding non-paying bullion.

Gains on Wall Street also dimmed bullion's appeal, as the Nasdaq and S&P 500 were boosted by mega-caps and a 20 per cent jump in Twitter's shares.

Spot silver edged 0.1 per cent lower to US$24.48 per ounce, platinum was little changed at US$986.06 and palladium rose 0.7 per cent to US$2,289.68. REUTERS