Gold prices rose to more than five-week highs on Monday after the United States said it would expel 60 Russian diplomats, prompting investor flight into assets considered safe havens. The United States was joining governments across Europe in taking action against the Kremlin after a nerve agent attack on a former Russian spy in Britain.
Gold, which is sought as a store of value in times of political and financial uncertainty, rose to its highest since February 16 at $1,355.97 an ounce. Spot gold was up 0.6 percent at $1,354.62 per ounce by 1:33 pm EDT (1733 GMT), while US gold futures for April delivery settled up $5.10, or 0.4 percent, at $1,355 per ounce. "I would attribute the rise in gold in the afternoon to the political developments," said Quantitative Commodity Research consultant Peter Fertig. "You could expect the Russians to retaliate."
The US dollar index fell to a five-week low against a basket of major currencies. The specter of a global trade stand-off, however, appeared to be receding after the United States and South Korea agreed to revise a trade pact, with US automakers winning improved market access and Korean steelmakers hit with quotas but avoiding hefty tariffs. Meanwhile, silver climbed 1 percent at $16.68 an ounce, earlier hitting $16.79, its highest since March 7. Platinum rose 0.4 percent at $950.90 per ounce and palladium declined 0.5 percent at $971.90.
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