Geo-political factors often play a key role in fluctuating the international market, demand, supply and overall economic stability. Many investors are concerned about international affairs. The sentiment of such investors and some other miscellaneous factors are the main driving force of the market. Gold is one of the most preferred commodities of such investors who believe in maintaining multiple portfolios. Europe, the US, Russia, and Ukraine are locked in some political tension, but this stress has helped the bullion to make weekly gains for the third straight week.
The reason investors are seeking protection in haven assets like gold
Spot gold has made remarkable progress after recently touching its highest figure since June 2021. The spot gold had made an overall gain of 1.9%. Senior market strategists have admitted that the Russia-Ukraine situation has positive and mild fluctuation as seen in gold. The lingering tension is likely to support the bullion, and the tension will fade very soon. Investor nerves began to become normal after the US and Russian officials decided to meet and find a diplomatic solution to the crisis. Not just Russia-Ukraine tension, investors are also concerned about market volatility. Inflation is also a factor that extends pressure on the investors.
The finance leaders of all major economies admit that the geopolitical risks and rising inflation should be controlled so as to ensure global recovery at a faster pace. When there are challenges such as soaring inflation, political-financial uncertainty, gold is considered a hedge. Silver made a gain of 0.6%, and it was standing at $23.96.
The condition of Asia-Pacific stock and currencies
In South Korea, the Kospi was relatively stable and at the end of the trading day the figure was 2,744.52. The mainland Chinese stocks were higher as the Shanghai composite made a gain of 0.66%, and it was standing at 3,490.76. The Shenzhen component was standing at 13,459.68 after making a gain of 0.274%. The Japanese yen is also believed to be a safe-haven asset. It was trading at 115.15 per dollar. The currency was still in a stronger position against the greenback. The U.S. dollar index was standing at 95.794 and the Australian dollar was standing at $0.7209. The demand for oil is rising because all sectors are now working in full swing, and there is also a possibility that Iranian oil production will grow. The US drillers have also added four more oil rigs, and the count stands at 520, which indicates oil is in huge demand.
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