Trump meets Zelenskiy, says Putin wants war to end, mulls trilateral talks
Investing.com -- Gold prices edged higher Monday, recovering from an over two-week low amid uncertainty over the course of the Russia-Ukraine war.
At 04:55 ET (08:55 GMT), Spot gold rose 0.4% to $3,348.30 an ounce and gold futures for October rose 0.3% to $3.393.97/oz.
The yellow metal had fallen to an over two-week low last week as U.S. President Donald Trump met Russian President Vladimir Putin and discussed a potential peace agreement with Ukraine.
Trump to meet Zelensky, European leaders
Friday’s meeting between Trump and Putin failed to result in a ceasefire in Ukraine, and the U.S. president is now set to meet Ukrainian President Volodymyr Zelensky and top European leaders at the White House later on Monday.
Reports suggested that Trump will demand Ukraine cede some territory to Russia to achieve a peace deal – a notion that Kyiv has repeatedly rejected.
Trump also indicated that Ukraine will have to cede Crimea and drop its bid to join the North Atlantic Treaty Organization (NATO) to reach a deal with Russia.
Markets remained uncertain over just what Monday’s meeting will yield, keeping safe havens in demand even as broader risk appetite appeared to have improved.
Trump’s last meeting with Zelensky at the White House, in February, ended inconclusively after a heated argument between the two leaders.
UBS lifts gold forecast
UBS has raised its long-term real gold price forecast to $2,800 per ounce from $2,200, implying nominal prices around $3,100 by 2030 when adjusted for inflation.
While short- and medium-term estimates remain unchanged, the bank continues to expect gold to hit new highs in the coming quarters before easing towards the end of next year or early 2027.
“Prices should ease thereafter, but the correction is unlikely to be steep enough to bring gold back to previous cycle lows,” strategists led by Joni Teves added.
“Instead, we see a scenario where, after a period of moderation and stabilization, gold settles at significantly higher levels than in previous cycles,” they said.
The upward revision partly reflects “structurally higher production costs” and expectations for limited mine supply growth, as producers favour organic expansion, regional consolidation and portfolio adjustments over large-scale M&A.
UBS also pointed to gold’s “broadening investor base” and its continued relevance as a strategic asset in an environment of shifting global trade and political relationships, elevated macroeconomic risks and persistent geopolitical tensions.
“In an environment where global trade and political relationships are shifting, macroeconomic risks are high and geopolitical risks persist, diversification is more crucial than ever,” the team continued.
“We think gold presents investors with one of the cleanest ways to hedge against these risks,” they said.
Jackson Hole symposium eyed
Focus this week is squarely on Fed Chair Jerome Powell’s address at the Jackson Hole symposium, which is expected to provide more cues on the central bank’s plans for rates.
Markets are pricing an over 83% chance the Fed will cut rates by 25 basis points in September, CME Fedwatch showed on Monday. But this was lower than the nearly 100% chance seen last week.
Markets tempered their bets on a September rate cut after hotter-than-expected producer inflation raised some concerns over the inflationary impact of Trump’s tariffs.
But this notion offered little support to the greenback, which remained rangebound on Monday after losing ground last week.
Mixed metals trading
Elsewhere, other precious metals saw mixed trading, with Platinum futures down 0.2% to $1,343.00/oz, while silver futures rose 0.4% to $38.133/oz.
Among industrial metals, benchmark copper futures on the London Metal Exchange fell 0.3% to $9,750.53 a ton, while COMEX copper futures fell 0.3% to $4.4790 a pound.
Copper declined late last week after soft industrial production and fixed asset investment data from China raised some questions about demand in the world’s biggest copper importer.
Ambar Warrick contributed to this article