Gold flat as higher US yields counter safe-haven bid

[BENGALURU] Gold was flat on Wednesday (Feb 23), holding near a 9-month high hit in the last session, as safe-haven demand was offset by a rise in Treasury yields following the first wave of US and European sanctions on Russia for sending troops into eastern Ukraine.

Spot gold was little changed at US$1,898.63 per ounce, as of 1.47 am GMT, after scaling its highest since Jun 1 at US$1,913.89 per ounce on Tuesday. US gold futures shed 0.3 per cent to US$1,901.90.

The United States, the European Union and Britain announced plans to target banks and elites while Germany halted a major gas pipeline project from Russia, which they say has amassed more than 150,000 troops near Ukraine's borders. Moscow has denied planning an invasion.

Actions the Joe Biden administration took on Tuesday and may take soon to punish Russia's economy over its aggression in Ukraine are not intended to hit global energy markets, a senior US State Department official said.

Yields on US Treasuries edged higher on Tuesday.

St Louis Fed president James Bullard has been among the most hawkish voices at the Federal Reserve in recent months, pushing for 100 basis points worth of rate hikes over the next 3 meetings.

Higher yields and interest rate hikes dent the appeal of bullion by raising the opportunity cost of holding non-interest paying gold.

Spot silver was up 0.2 per cent at US$24.13 per ounce, platinum was flat at US$1,075.75 and palladium rose 0.3 per cent to US$2,353.69. REUTERS