Gold is rising as the demand for safe havens increases

Gold prices rose on Wednesday after fears of an escalation of the conflict between Russia and Ukraine boosted demand for safe-havens, including the precious metal, but gains were limited by the rise of the dollar.

Spot transactions rose 0.2 percent to $ 1969.76 an ounce, after hitting a one-month high of $78.21 an ounce on Tuesday.

And US gold futures settled at 1975.80 dollars an ounce.

On Tuesday, Russian President Vladimir Putin said negotiations with Ukraine had “reached a dead end” while US President Joe Biden said for the first time that Russia’s invasion of Ukraine amounted to genocide.

The dollar index has settled near a high reached in May 2020, which makes gold less attractive to buyers abroad.

Although gold is a hedge against inflation and geopolitical risks, raising interest rates also increases the opportunity cost of holders of the precious metal, which does not generate interest.

As for other precious metals, silver increased in spot transactions 0.4 percent to $25.46 an ounce. Platinum rose 0.7 percent to $972.51 an ounce. Palladium rose 3.1 percent to $2,398.15 an ounce.