Gold prices recovered some gains on Monday and erased part of earlier losses as concerns about the global banking sector returned to the fore, despite bailout efforts by UBS to acquire rival Credit Suisse to stabilize financial markets more broadly.
Spot gold prices rose 1% to $2007.30 an ounce by 07:47 GMT, after falling 1% earlier in the session, hitting their highest levels since March last year. U.S. gold futures jumped 2% to $2012,50.<>.
Gold prices rose 10 percent, or about $180, on rising demand for it as a safe haven after the collapse of the U.S. Bank of Silicon Valley earlier this month, which in turn caused a crisis for the 167-year-old Credit Suisse.
UBS agreed on Sunday to buy Credit Suisse for $3.23 billion and incur losses of up to $5.4 billion, in a deal backed by a massive Swiss guarantee.
Credit Suisse was hit by a widening crisis following the collapse of Silicon Valley Bank in the United States, and gold rose more than 8%, or $160, amid rising demand for safe havens.
The dollar rose 0.1 percent, making the yellow metal expensive for overseas buyers.
Among other precious metals, spot silver was little changed at $22.59 an ounce, while platinum lost 0.5% to $970.53 and palladium fell 0.8% to $1407,70.<>.
Oil is falling
Oil prices fell to 15-month lows today, on concerns that risks in the global banking sector could trigger a recession that could lead to lower fuel demand and ahead of a possible rise in U.S. interest rates this week.
Brent crude futures fell 3.5% to $70.40, Brent crude fell about 12% last week, recording its biggest weekly decline since December, and West Texas Intermediate crude fell 3.6% to $64.34.
The upcoming OPEC meeting will be a potential catalyst for the market outlook, as the risk of falling oil prices will increase the likelihood of OPEC cutting production further to support prices.