Gold is rising on Tuesday morning on political tensions

The value of gold is steadily growing on the first day of February. The current quote of the precious metal is $1.803 per ounce. Analysts call the main reason for the growth of the asset the strengthening of foreign policy tensions in the international arena caused by the contradictions around Russia and Ukraine.

And since gold is a «safe haven asset», increased tension successfully supports demand for it, somewhat leveling the recent weakening from the $1.850 level due to the tightening of the monetary policy of the US Federal Reserve System. Traditionally, gold acts as a resource that investors prefer to acquire in the event of difficult and questionable situations. 

The markets are also focused on the meetings of the European and British central banks on Thursday. If both regulators agree to increase interest rates, the demand for national currencies will grow, and for the precious metal will decrease.

Analysts also presented a report on the global demand for gold by the end of 2021. According to statistics, demand reached the level of 4,021 tons, which was facilitated by a 50% growth in the fourth quarter. In annual comparison, the indicator increased by 10%. It is noted that such indicators are caused by the recovery of the jewelry and technology sectors of the industry, as well as active purchases of gold from central banks.