Gold Prices Fall 1% As Ukraine Tensions Ease

Gold prices fell 1 percent on Tuesday, retreating from the previous day’s four-month high, after President Vladimir Putin ordered troops involved in a military exercise in western Russia back to base, easing fears of war in Ukraine.

The precious metal rallied nearly 2 percent on Monday as the threat of escalating tensions in Ukraine’s Crimea region spurred investors to seek refuge in bullion and government debt. Crude oil futures climbed while stock markets plunged.

Those moves went into reverse early on Tuesday, with world shares and hard-hit Russian assets recovering some lost ground as immediate tensions in the East-West crisis over Ukraine abated.

There was no word, however, on Russian forces that have effectively occupied much of Crimea, and financial assets failed to retrace the entirety of the sharp moves seen globally on Monday.

Spot gold was down more than 1 percent at $1,336 an ounce. U.S. gold futuresfor April delivery were down $14 an ounce at $1,336.

Gold remains up nearly 1 percent this week, having reached its highest since Oct. 30 on Monday at $1,354.80 an ounce. However, its gains could be vulnerable to economic data releases later this week, VTB Capital analyst Andrey Kryuchenkov said, including ADP jobs figures on Wednesday, a statement from the European Central Bank on Thursday, and U.S. non farm payrolls on Friday.

Source: Reuters