11.08.201400:49:36UTC+00Mid East situation holds gold near highest in three weeks

Global tension centered around Ukraine and the Middle East is holding gold just below a three week high even as holdings under the largest gold backed exchange traded product experienced its largest weekly decline in three months.

Spot gold was trading at a price per ounce of $1,307.79 mid morning Singapore time after closing last August 8th at $1,309.58 when the US first authorized air strikes on militant threats in Iraq. The precious metal ended three consecutive losing weeks, the longest period of decline since September 2013, by gaining 1.2% last week.

Futures with a delivery date in September dropped to a price per ounce as low as $1,307.90 in New York’s Comex and traded at $1,308.30.

Pushing prices up included tensions between Gaza and Israel where forces from both sides have agreed to another truce with help from the government of Egypt. In Ukraine, the military refused the offer made by separatist rebels of a cease fire and instead demanded a surrender.

GF Futures Co analyst Zhu Siquan says that, “While it appears as though concerns are fading, as long as geopolitical risks still exist in the background, gold will continue to be supported.” Zhu adds that buying will be mostly done through headlines, but large interest from investors does not look likely as shown by an outflow in SPDR holdings.

The SPDR Gold Trust saw its assets decline to 795.86 metric tons after losing 0.2% on August 8th. It had a weekly loss of 0.8%, the largest fall since May 2, to pull it down below the level it ended at last year.

Spot silver also fell to a price per ounce of $19.8594 to show a difference of 0.2%. Platinum for immediate delivery likewise dropped 0.2% from its value to end up at $1,371.88. Palladium retreated 0.3% for a price per ounce of $857.57.