Gold Prices Fall to 1-Week Low on Euro Despite Rising Ukraine Tensions

Reuters

Gold fell to its lowest in a week on Monday as the euro hovered near a one-month low on fears of policy action from the European Central Bank, shrugging off safe-haven demand from escalating violence in Ukraine. FUNDAMENTALS * Spot gold eased 0.5 percent to $1,282.50 an ounce by 0028 GMT, after dropping for two straight weeks. It fell to a one-week low of $1,279.60 earlier in the session. * The euro has lost more than 1 percent since Thursday when Mario Draghi said the bank was ready to take action next month should updated inflation forecasts merit it. A stronger dollar in turn makes bullion more expensive for holders of other currencies. * Investors seemed to ignore weekend developments in Ukraine, where pro-Moscow rebels declared a resounding victory in a referendum on self-rule for eastern Ukraine, with some saying that meant independence and others eventual union with Russia as fighting flared in a conflict increasingly out of control. * Hedge funds and money managers raised their bullish bets in gold futures and options for the second time in two weeks, as rising geopolitical tensions in Ukraine increased bullion's safe-haven appeal, according to data from the Commodity Futures Trading Commission on Friday. * Gold imports in India, the second-biggest consumer of bullion, fell 74 percent in April to $1.76 billion from a year earlier. * For the top stories on metals and other news, click , or MARKET NEWS * Wall Street's blue chips set a record close in a lackluster session on Friday while the U.S. dollar strengthened against the euro and Japanese yen. DATA/EVENTS (GMT) 0500 Japan Economy watchers poll April 1800 U.S. Federal budget April PRICES AT 0028 GMT Metal Last Change Pct chg Spot gold 1282.5 -6.52 -0.51 Spot silver 19.07 -0.04 -0.21 Spot platinum 1420.7 -1.92 -0.13 Spot palladium 796 -1.38 -0.17 Comex gold 1283 -4.6 -0.36 Comex silver 19.085 -0.036 -0.19 Euro 1.3757 DXY 79.881 COMEX gold and silver contracts show the most active months (Reporting by A. Ananthalakshmi; Editing by Richard Pullin)

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