2014.04.2503:21:09UTC+00Gold Surges as Ukraine-Russia Crisis Trigger Demand

Gold bounced back from a 10-week low in New York as dispute between Ukraine and Russia mounted, triggering demand for haven assets.

President Vladimir Putin warned Ukraine versus extending its anti-separatist offensive after government troops killed five rebels and triggered Russia’s military to start new drills. The metal achieved a six-month high in March after Russia annexed Ukraine’s Crimean region. The news today spurred traders to unwind bets on a decline, said Steven Scacalossi, the head of global metals sales at TD Securities in Toronto.

“It was several Russia/Ukraine headlines that lit the short-covering fuse,” Scacalossi said in an e-mailed report. “Risk appetite is being hit with expectation that the West will introduce more aggressive sanctions against Russian interests.”

Gold futures for June delivery skyrocketed 0.5 percent to end at $1,290.60 an ounce at 1:38 p.m. on the Comex in New York. Financial values earlier backed down to $1,268.40, the weakest since February 10.

The U.S. threatened more penalties versus Russian interests including the banking, mining and energy division, if it will be unsuccessful to calm down the tension.

Gold backslide 28 percent in 2013, the largest yearly loss since 1981, on beliefs that the Federal Reserve would trim down stimulus as the U.S., world’s biggest economy bounces back.

Silver futures for July delivery jumped 1.3 percent to $19.714 an ounce on the Comex. Earlier, the financial worth reached $18.95, the worst for a most-active contract this year. Exchanging was 175 percent over the average for the past 100 days, data gathered by Bloomberg show.

On the New York Mercantile Exchange, platinum futures for July delivery soared 0.4 percent to $1,409.60 an ounce.

Palladium futures for June delivery appreciated 2.1 percent to $802.30 an ounce on the Nymex. The financial value hike to $817 on April 14, the topmost since August 2011, on assumption supplies may be limited from Russia, the largest producer.

Holdings in palladium-aided exchange-traded goods rallied 1.6 metric tons to a record 78.7 tons yesterday, data recorded by Bloomberg show.