Gold back above $3,300 as geopolitical jitters persist – Commerzbank

Gold is back in demand amid rising geopolitical uncertainty and a weakening US dollar, with prices climbing above $3,300 per ounce. However, upside potential may be limited as high prices weigh on physical demand in Asia, Commerzbank's commodity analyst Barbara Lambrecht notes.

Safe-haven appeal lifts Gold, but upside may be limited

"Gold is showing strength again, as it is particularly in demand in these politically uncertain times, also because other supposed safe havens such as the US dollar are currently under pressure. The price of Gold is now back above $3,300 per troy ounce, almost $200 higher than its low in the middle of last week."

"Of course, there are many conceivable scenarios in which Gold could benefit from a further increase in risk aversion. However, we consider the upside potential to be largely exhausted, as the high prices are also dampening physical demand in Asia."

"Nevertheless, China's Gold imports were probably high in April because the central bank raised the quotas. Imports from Hong Kong and Switzerland, which are due to be published next week, could have been correspondingly strong."