Crimea independence move pushes gold prices

Tuesday, March 11, 2014

ANKARA - The gold price pushed up to $1,350 per ounce after Crimea's local assembly members voted for independence from Ukraine.

The Parliament of the Autonomous Republic of Crimea and the Sevastopol City Council voted to adopt a declaration of independence from Ukraine during an extraordinary session on Tuesday.

Gold prices had started the day at $1,339 per ounce but pushed up to over $1,350 after the declaration and warning messages from the U.S. and the EU over the planned referendum March 16 on Crimea's status.

Analysts say that data from the U.S. is very weak and the flow statements from Ukraine are effective in the price of gold.

"There are many reasons that the gold prices increases,” Gokan Sen, head of international market of Turkey-based AK investment, said.

"Demands from China are very high, over the seasonal demands. Despite low inflation in the U.S., no increase in the interest rate and the U.S. federal reserve cutting its economic stimulus program," he said. 

"It is a possibility that the high tensions between the West and Russia are supporting the gold price hike. I think the Russian president´s actions will determine where the gold price will go," Sen continued.

He also added that problems in developing countries are contributing to the increase in gold prices.

Yeliz Karabulut, head of research at ALB Security, said the gold price had been increasing after the tensions have increased in Ukraine in this week and added that if the gold prices stay over the $1,355 per ounce, then it could possibly reach $1373 or $1420 per ounce.

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