Gold eases as dollar, yields firm; Ukraine woes cap losses

[BENGALURU] Gold prices eased on Monday (Apr 11), as the dollar and Treasury yields firmed on prospects of aggressive interest rate hikes by the US Federal Reserve, while fresh concerns over Russia's attacks in eastern Ukraine lent some support to the safe-haven metal.

Spot gold was down 0.2 per cent at US$1,942.93 per ounce, as of 1.40 am GMT, after hitting a more than 1-week high of US$1,949.32 earlier in the day. US gold futures were up 0.2 per cent at US$1,949.00.

The US dollar index was steady after topping 100 for the first time in nearly 2 years on Friday on bets of aggressive Fed measures to contain soaring inflation.

A stronger dollar makes gold less attractive for other currency holders.

The 10-year US yield hit 2.73 per cent on Friday, its highest since March 2019, as traders bet on a more hawkish Fed stance.

Higher US interest rates and yields increase the opportunity cost of holding bullion, which is also used as a hedge against rising inflation.

Russian forces pounded targets in eastern Ukraine with missiles and artillery on Sunday, as Austria's leader planned to meet with Russian President Vladimir Putin.

Discounts on physical gold in India widened as scrap supplies increased amid only a slight improvement in demand, while purchases in top consumer China were steady despite Covid-19 lockdowns as buyers sought safe-haven assets.

Spot silver was flat at US$24.75 per ounce and platinum rose 0.7 per cent to US$981.41.

Palladium was up 2.8 per cent at US$2,494.48 after hitting a more than 2-week high earlier in the session.

The auto-catalyst metal gained 8.6 per cent on Friday after newly refined Russian platinum and palladium were suspended from trading in London, denying access to the metals' biggest trade hub. REUTERS