Feb 17 (Reuters) – Gold prices slipped from the $1,900 level on Friday, as a potential Russia-U.S. meeting next week spurred expectations of a diplomatic solution to the standoff over Ukraine.
Spot gold fell 0.4% to $1,890.05 per ounce, as of 0456 GMT, after touching its highest in eight months at $1,902.22 earlier in the session. The metal on Thursday rose above $1,900 for the first time since June as investors rushed to the safety of bullion after Ukraine tensions heightened.
U.S. gold futures dropped 0.5% to $1,892.30.
U.S. stock futures bounced on Friday and selling pressure eased in Asian share markets after the U.S. Secretary of State agreed to a meeting with Russia’s foreign minister late next week provided Russia does not invade Ukraine.
“We are seeing gold in extension of that invasion trade, said IG Markets analyst Kyle Rodda and “the next technical level to watch is around $1,920, so there’s certainly technical basis to see gold prices rise.”
U.S. 10-year Treasury yields firmed on Friday, increasing the opportunity cost of holding non-interest-paying bullion
Still, spot gold is set for a third straight weekly gain, up about 1.6% so far.
“In the short term, bullion market inflows have clearly been buttressed by Russia/Ukraine geopolitics, higher equity market vols, and inflation hedge demand,” analysts at Citi said in a note.
Spot silver fell 0.2% to $23.76 per ounce and palladium dipped 0.9% to $2,345.18, with both set for small weekly gains.
Platinum gained 0.2% to $1,091.09, setting up its best weekly showing since June.
(Reporting by Bharat Govind Gautam in Bengaluru; Editing by Rashmi Aich and Sriraj Kalluvila)