Russia-Ukraine war pushed up global gold prices to $2,000 per ounce

Inflation concerns have caused a surge in safe asset investment as market volatility continues to push global gold prices to $2,000 an ounce on Monday.

It also ads the fears of supply shortages due to the Russian-Ukrainian conflict along with robust demand has kept prices higher. Sanctions on Russia are also expected to reduce the supply of gold with Russia being a major producer of Gold.

Gold prices have reportedly increased by more than $40, accelerating a well-defined upward trend that started in the first week of March. Kshitij Purohit, Lead of Commodities and Currencies CapitalVia Global Research says that gold has risen above $2,000 an ounce on increased demand for safe-haven assets as investors assess the geopolitical and economic consequences of Russia’s invasion of Ukraine. 

Tapan Patel, Senior Analyst at HDFC Securities also said that gold relies on geopolitical risk and inflation worries as the Western world is mulling for harsher sanctions on Russia, including an oil import ban. 

In addition, IIFL Securities VP, Research, Anuj Gupta has said that geopolitical tension between Russia and Ukraine plays a supportive role in gold prices, however, this environment is negative for global equity markets.