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Gold rises as G7 nations plan to ban bullion imports from Russia

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Gold prices gained on Monday, as news of

some Western nations planning to officially ban imports of the

metal from Russia for its invasion of Ukraine sparked some

interest in bullion.

Spot gold rose 0.5% to $1,835.75 per ounce by 0520

GMT. U.S. gold futures were up 0.4% at $1,837.30.

“The G7 import ban on Russian gold seems to be providing

some short-term support in early Asia (trading),” OANDA senior

analyst Jeffrey Halley said.

“However, it is mostly a rubber stamp exercise in reality

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for the grouping, and I do not expect this to mark a structural

change in the supply/demand outlook that will underpin prices.”

Four of the Group of Seven (G7) rich nations moved to ban

imports of Russian gold on Sunday to tighten the sanction

squeeze on Moscow and cut off its means of financing the

invasion of Ukraine.

“The headline will be quickly digested, and the market

should go back to its tug of war between higher front-end rates,

negative for gold, and recession odds meaning sooner rate cuts,

positive for gold,” said Stephen Innes, managing partner at SPI

Asset Management.

A pair of U.S. central bankers said on Friday they supported

further sharp rate hikes to stem rapid price rises, even as

investors cheered economic data showing inflation expectations

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to be less worrisome than initially feared.

Gold is seen as a hedge against inflation, but higher

interest rates raise the opportunity cost of holding bullion,

which yields no interest.

“Overall, gold remains mired in the middle of the

$1,780-$1,880 range that’s been in place since early May, and we

will need a large directional move by the U.S. dollar to change

that dynamic,” Halley said.

Spot silver rose 1.3% to $21.38 per ounce, platinum

gained 0.7% to $913.51, and palladium climbed 2.6%

to $1,925.31.

(Reporting by Bharat Govind Gautam in Bengaluru; Editing by

Rashmi Aich and Subhranshu Sahu)

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