Gold Falls Back Under $1,900 On Biden-Putin Agreement To Kickoff Talks

Gold hit fresh multi-month highs near the $1,910 on Monday but has since dropped back under the $1,900 handle. Geopolitics remains the wildcard that could stoke surprise volatility in either a bullish or bearish direction.

The Russian ruble has been coming under significant pressure on Monday, indicative of rising fears of a Russian invasion or military incursion into Ukraine that would trigger a round of sanctions from Western countries against Moscow.

Violence between pro-Russia separatists and Ukraine’s military in the contested Donbass region continued on Monday, the former group upping the inflammatory rhetoric by accusing Ukraine’s military of shelling and planning a full-scale assault.

This is keeping gold underpinned close to recent highs. At current levels in the mid-$1,890s, the precious metal trades close to flat on the day and only about 0.75% below earlier session highs.

One bearish risk to note for gold is whether a summit between Russian President Vladimir Putin and US President Joe Biden goes ahead this week following recent chatter.

The meeting could be a good opportunity to ease tensions somewhat. Otherwise, US data and Fed speak will be worth watching, but will, for the most part, still play second fiddle to the Ukraine crisis.