By Barani Krishnan
Investing.com -- Gold hit eight-month highs above $1,900 an ounce on Thursday as investors piled into the yellow metal and other safe havens amid escalating tensions over the Russia-Ukraine conflict.
Gold’s most active contract on New York’s Comex, April, settled up $30.50, or 1.6%, at $1,902 an ounce. The session high was $1,903.65.
The last time gold traded above that was on June 11, making Thursday's peak the highest in eight months.
Year-to-date, Comex’s most-active contract has already risen 3.6%, it’s most since 2020 when it got to record highs above $2,100.
Gold's rally actually began in early December but it really picked up in earnest this year on signs of no let up in U.S. inflation. The Consumer Price Index grew at 7.0% and 7.5% in the year to December and January, respectively, their highest since 1982 for both. The economy itself grew by only 5.7% for 2021.
While Inflation has been the central theme to the gold rally, the Russia-Ukraine tensions have reintroduced an element that had been missing for a while from gold -- i.e. the geopolitical hedge that bullion was also famous for at one time.
Geopolitics were certainly the catalyst for gold's move on Thursday toward $1,900, analysts said.
"The price is being pushed higher on flight to safety as Russian/NATO/US tensions increase," analyst Greg Michalowski said on the ForexLive platform. "The respective parties are not getting any closer toward a friendly agreement."
Michalowski said that based on its daily chart, Comex gold's front-month has moved above the 50% midpoint of the move down from its August 2020 record high. "That level comes in at $1876.02," he said, noting that the breach happened Thursday, after a failed attempt earlier this week to break that resistance.