Gold settled higher on Thursday as tensions over Ukraine increased and equity markets retreated, but analysts said the rebound could be short-lived due to strong U.S. economic growth and prospects of a U.S. interest rate hike.
NATO said on Thursday well over 1,000 Russian troops are operating inside Ukraine, marking a significant escalation of Moscow's military involvement in the country.
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Gold rose as much as 1 percent early in the day but later cut gains after data showed the U.S. economy rebounded more strongly than initially thought in the second quarter. A bigger chunk of the growth was driven by domestic demand in a bright sign for the future.
"The market woke up on geopolitical headlines around Ukraine but we gave up some gains because of very strong U.S. economic data," VTB Capital analyst Andrey Kryuchenkov said.