Gold prices rose in European trade after a short hiatus from gains, amid active haven demand due to rising Ukrainian tensions and prospects of new western sanctions on Russia.

Another crisis is emerging worldwide, and it's the resurgent coronavirus crisis in China, which forced the closure of several major cities, including Shanghai.

Gold prices rose over 0.4% to $1,933 an ounce, after closing down 0.6% on Friday, the first loss in three days following strong US labor data.

Gold prices lost 1.7% last week, the second weekly decline in a row as haven demand declined and dollar strengthened.

New Sanctions

Germany said the west will agree on imposing new sanctions on Russia soon, after Ukraine accused Russia of committing war crimes.

Germany and Italy announced readiness to discuss banks on Russian gas supplies, the first such indication of a move against this vital resource.

Ukraine accused Russian forces of committing a "massacre" in the Ukrainian city of Botcha, which was denied by the Russian defense ministry.

US Dollar

US dollar rose over 0.2% on Monday for the third straight session against a basket of major rivals, pressuring gold and other dollar-denominated commodities.

Renewed demand on dollar comes as concerns rise again over geopolitical tensions in Ukraine, while US 10-year treasury yields rose following strong US labor data.

A Crisis in China 

Chinese authorities reported 13,146  Covid 19 infections on Sunday, the highest in the latest wave, which already hit over 100,000 people in China.

The SPDR 

Gold holdings at the SPDR Gold Trust rose 0.29 metric tones to a total of 1,091 tones on Friday.

Forecasts 

Analysts expect the ongoing crisis in Ukraine to continue bolstering gold prices, however higher US treasury yields will put a cap on gains.

That's way gold prices continue to move in such sideways trading until the picture clears up about the new western sanctions on Russia and the spread of the new Covid 19 wave in China.

Euro declined in European trade for the third straight session against dollar away from four-week highs on active profit-taking, and amid concerns about the mounting economic damage from the war in Ukraine.

It's expected the west will impose new sanctions on Russia, potentially on energy imports, which could lead to a new spike in prices, as Russia supplies 40% of Europe's energy needs.

EUR/USD fell 0.3% to 1.109, after closing down 0.15% on Friday, on profit-taking from four-week highs at 1.1185.

Euro rose 0.6% last week against dollar, the second weekly profit in three weeks on hopes for a peace deal for Ukraine.

New Sanctions 

Germany said the west will agree on imposing new sanctions on Russia soon, after Ukraine accused Russia of committing war crimes.

Germany and Italy announced readiness to discuss banks on Russian gas supplies, the first such indication of a move against this vital resource.

Ukraine accused Russian forces of committing a "massacre" in the Ukrainian city of Botcha, which was denied by the Russian defense ministry. 

Forecasts

Analysts expect higher euro to pierce 1.0800 against dollar if news of the war or higher oil prices kept accumulating.

Oil futures rise over 1% as the dollar index loses ground on profit-taking, following hefty losses by oil prices last week and ahead of important US data later today, while markets price in latest developments in the Ukrainian crisis

As of 06:39 GMT, US crude futures due in May rose 1.59% to $100.52 a barrel, after closing down at $99.27 last week.

Brent futures due ion May rose 1.38% to $105.69 a barrel, after closing down at $104.39 last week, as the dollar index shed 0.03% to 98.60.

From the US, factory orders are expected down 0.5% after rising 1.4% in January.

In China, Shanghai has registered 9006 new Covid 19 infections yesterday, the largest one-day increase ever, with the army sending over 2000 medical employees to Shanghai to manage the situation.

The World Health Organization reported 486 million infections worldwide so far, with deaths mounting to 6.14 million.

Otherwise, oil prices are rising on short-covering after a 12% tumble last week, the worst such weekly decline since April 2020 after President Joe Biden released the country's strategic crude stocks to control prices.

Baker Hughes data last week showed oil rigs rose by 2 to 533 rigs, the highest since April 2020, while US crude production rose 100 thousand bpd to 11.7 million bpd after production settled in the last eight weeks.

US crude output fell 1.4 million bpd, or 12% from record highs at 13.1 million bpd in March 2020 as several companies closed theirs rigs due to higher operating prices back then.

Most US stock indices declined at the first session of April and the first session of the second quarter.

US unemployment fell top 3.6% in March, the lowest since February 2020, and besting estimates of 3.7%, and improving from February's 3.8%.

US economy added 431 thousand new jobs in March according to the payrolls report, missing estimates of 492 thousand, and down from February's 750K addition.

Otherwise, the Russian government just announced plans to start accepting natural gas purchases from unfriendly countries only with the Ruble. 

Dow Jones fell 0.2% as of 14:37 GMT to 34,628, while S&P 500 settled at 4,531, as NASDAQ rose 0.3% to 14,266.