Gold breaks through resistance on US-Russia tensions and declining US bond yields

GOLD prices had an exciting finish to an otherwise boring week, and are set to close the week above resistance at US$1,760 to its highest level in over a month. Gold broke higher to levels last seen in late February after the Biden administration targeted Russia with sweeping sanctions and diplomatic expulsions.

Gold prices were further boosted after US Treasury yields retreated despite better-than-expected US economic data released on Thursday. Yields on the 10-year note slumped to their lowest in a month. The declines came after US retail sales accelerated in March by the most in 10 months. Businesses in the US are re-opening and shoppers received a fresh round of stimulus cheques. Gold had earlier fallen in a sombre mood, trading sideways since the start of the week without any definitive driver and traders mostly reacting to global bond yield movements together with the US dollar.

Gold kicked out of the lull on Thursday when the US imposed a broad array of sanctions on Russia to punish it for interfering in last year's US election, cyber hacking and bullying Ukraine. Gold's role as a safe-haven in time of rising geopolitical risk was back in focus and demand for the yellow metal rose.