Gold rises 1.3 pct on Ukraine tension; palladium up
New York (July 17) Gold prices climbed more than 1 percent on Thursday on heightened geopolitical tensions and news of more U.S. sanctions against Russia, while palladium rose more than 1 percent on renewed supply worries.
Safe-haven bids boosted bullion after a Ukrainian fighter
plane was shot down over eastern Ukraine as government forces
were fighting to quell a pro-Russian separatist rebellion.
Russia's U.N. ambassador later said Russia "did not do it."
Precious metals were underpinned by U.S. President Barack
Obama's move to impose sanctions on some of Russia's biggest
companies for the first time over Moscow's failure to curb
violence in Ukraine, striking at the heart of Vladimir Putin's
powerbase by targeting companies closest to him.
The sanctions, the toughest yet imposed by the United
States, also helped send palladium to 13-1/2 year highs. The
metal is chiefly sourced from Russia.
"Palladium is feeding off supply worries as the U.S. imposed
new sanctions on Russia, and gold is also getting support on the
news at above $1,300 an ounce," said Thomas Capalbo, precious
metals trader at brokerage Newedge.
Spot gold was up 1.3 percent at $1,315.91 an ounce at
11:33 a.m. EDT (1533 GMT). U.S. gold futures for August
delivery were up $16.40 an ounce at $1,316.20.
The yellow metal accelerated gains in late New York morning
trade as U.S. equities slid.
Investors closely monitored a report that a Malaysian
passenger airliner with 295 people on board had crashed in
Ukraine near the Russian border on Thursday. The Interfax news
agency reported the crash, citing an aviation industry source.
Palladium rallied to a 13-1/2 year high as the new U.S.
sanctions fueled further buying from investors already expecting
supply to struggle to keep pace with demand this year.
Spot palladium peaked at $887.20 an ounce and was
last up 1.8 percent at $886.65. It is the best performing of the
main precious metals this year, up 24 percent so far.
Spot platinum was up 1.5 percent at $1,499.50 an
ounce, while spot silver rose 1.6 percent at $21 an