Gold News

Russia's 'Nuclear Terrorism' Sees Gold Hit Fresh Euro Record as Stock Markets Tumble

GOLD PRICES jumped to new all-time highs against a tumbling Euro on Friday, rising in all other currencies as well as global stock markets sank and investors fled into Western government bonds on news of Russian troops attacking Europe's largest nuclear power plant in their invasion of Ukraine.
With 6 nuclear reactors and 6 cooling pools, Zaporizhzhia in south-eastern Ukraine generates 1/5th of the country's electricity. The fire, now out, spread across 3 floors of a training building.
"Right now, Russian tanks are firing at the nuclear units," said Ukraine's President Volodymyr Zelensky in a video on social media early Friday. "They know where they are shooting.
"This marks terror of an unprecedented level".
Equities in neighboring Hungary's BUX index extended their drop from November's all-time high to worse than 25%, while Poland's WIG index traded over 14% down for 2022-to-date and the Czech Republic's PX index has now lost over 11% from the 13-year highs hit only 2 weeks ago.
News of the fire also saw Germany's Dax and London's FTSE100 indices both lose 3.1% as the Western European EuroStoxx 600 sank by 2.6%, but with Asian stock markets all closing sharply lower overnight, Pakistan's KSE100 index held flat despite  a suicide bomber killing 56 and injuring 190 during Friday prayers at a Shia mosque in Peshawar
Poland's Zloty and the Czech Koruna both rallied from this week's plunge as their central banks intervened in the market to support their currencies.
But gold priced in the Euro meantime touched €1785 per ounce – more than €15 above last week's fresh record – as the single currency extended its worst week in 7 years against the Dollar on the forex market, falling below $1.10 for the first time since May 2020, height of the initial Covid Crisis.
Chart of gold priced in Euros, last 3 months. Source: BullionVault
Trading at $1945 on Friday, the Dollar gold price remains 6.1% below its record peak of 6 August 2020.
The UK gold price in Pounds per ounce remains 7.2% below its all-time high, also set that day, at £1470.
The Russian invasion already puts the International Atomic Energy Agency in an "unprecedented" situation, "completely uncharted waters", says Rafael Mariano Grossi, director-general of the IAEA – a United Nations' body – volunteering to visit Chernobyl, site of the world's worst nuclear accident over 3 decades ago, and now in Russian hands, to reach a "framework" for nuclear safety amid the fighting.
Zelensky today again urged the Nato military alliance – of which his country isn't a member – to impose a no-fly zone, shooting down Russian aircraft.
But "Nato is not part of the conflict. We don't seek war, conflict with Russia," said the alliance's head Jens Stoltenberg on Friday, calling on Moscow to cease its "brutal" invasion and praising Nato member states for imposing "unprecedented sanctions" on Russia.
Beyond the sanctions imposed by Western governments, private corporations yesterday refused to bid for Russian crude oil according to trader Trafigura.
"The Perth Mint is not currently willing to sell or deliver gold to Russia," said the Australian refinery's acting chief executive Jane King today.
Gold-mining start-up Wiluna (ASX: WMC) meantime suspended its shipments of concentrate for processing by Russian miner Polymetal (LON: POLY) after making its maiden delivery only 2 weeks ago.
"Commodities soar as war increases anxiety over supply shortages," says a headline at Bloomberg, with European benchmark Brent crude oil now at new 8-year highs above $114 per barrel.
The yield offered to new buyers of Western government debt meantime fell sharply once more, pulling 10-year US Treasury rates down to 1.77% – nearly 0.3 points below mid-February's 30-month highs – despite new data saying that the world's largest economy added 678,000 jobs last month, over 2/3rds more than analysts expected.

Adrian Ash

Adrian Ash, BullionVault Gold News

Adrian Ash is director of research at BullionVault, the world-leading physical gold, silver and platinum market for private investors online. Formerly head of editorial at London's top publisher of private-investment advice, he was City correspondent for The Daily Reckoning from 2003 to 2008, and he has now been researching and writing daily analysis of precious metals and the wider financial markets for over 20 years. A frequent guest on BBC radio and television, Adrian is regularly quoted by the Financial Times, MarketWatch and many other respected news outlets, and his views from inside the bullion market have been sought by the Economist magazine, CNBC, Bloomberg, Germany's Handelsblatt and FAZ, plus Italy's Il Sole 24 Ore.

See the full archive of Adrian Ash articles on GoldNews.

Please Note: All articles published here are to inform your thinking, not lead it. Only you can decide the best place for your money, and any decision you make will put your money at risk. Information or data included here may have already been overtaken by events – and must be verified elsewhere – should you choose to act on it. Please review our Terms & Conditions for accessing Gold News.

Follow Us

Facebook Youtube Twitter LinkedIn



Market Fundamentals