Gold prices were flat on Thursday as risk appetite improved after the U.S. Federal Reserve chairman tried to assuage fears about aggressive interest rate hikes, offsetting safe-haven demand spurred by the Russia-Ukraine conflict.

Fundamentals
Spot gold held its ground at $1,927.18 per ounce by 0117 GMT. U.S. gold futures rose 0.4% to $1,929.90.

Ukraine’s second-biggest city, Kharkiv, suffered heavy bombardment on Wednesday as Russia’s week-long invasion was denounced by the United Nations in a historic vote.

The biggest attack on a European state since 1945 has caused more than 870,000 people to flee, led to a barrage of sanctions against Russia, and stoked fears of a wider conflict in the West unthought-of for decades.

The new round of sanctions announced by the White House ban the export of specific refining technologies, making it harder for Russia to modernize its oil refineries.

Fed Chairman Jerome Powell said the central bank would begin “carefully” raising interest rates at its upcoming March meeting but be ready to move more aggressively if inflation does not cool as quickly as expected.

Wall Street gained and benchmark U.S. 10-year Treasury yields edged higher on Wednesday.

Even though gold is considered a safe investment during political and economic uncertainty, it is highly sensitive to rising U.S. interest rates, which increases the opportunity cost of holding bullion.

Palladium, used by automakers in catalytic converters to curb emissions, slipped 1.3% to $2,633.65, after hitting its highest level since July at $2,722.79 on Tuesday.

Spot silver fell 0.4% to $25.14 per ounce, while platinum shed 0.4% to $1,067.00.