Lower In Asia

Gold deals ~$15/oz lower to print $1,976.6/oz at writing. The precious metal trades around Wednesday’s troughs as hope for a diplomatic resolution to (or de-escalation in) the Russia-Ukraine conflict has received a boost, with Foreign Ministers from both Ukraine and Russia due to meet for talks later today.

• To recap, gold closed ~$60/oz lower on Wednesday, with the move lower facilitated by Ukrainian leaders expressing openness to discussing Ukrainian neutrality (as opposed to insisting on NATO membership), a major sticking point in talks with Russia. However, other Russian demands, particularly on the recognition of Russia’s annexation of Crimea and the sovereignty of Ukrainian separatists in the East, continue to be non-starters, while Ukrainian FM Kuleba has stated that his expectations of the talks “are low”.
• Participants removed some of the inflation-linked price premium for gold on Wednesday as major crude benchmarks took a tumble, with WTI and Brent closing ~$15 lower apiece on the day, while broad U.S. real yields moved away from their recent trough.
• Elsewhere, the U.S. has emphatically rejected Poland’s proposal to transfer Polish jet fighters to Ukraine, easing some worry re: increased western involvement in the war in Ukraine.
• From a technical perspective, bullion has broken below support at $1,981.2/oz (Mar 8 low), exposing the next support level at $1,929.9 (Mar 4 low). Conversely, resistance is situated at $2,070.4/oz (Mar 8 high).