Gold prices jumped sharply today in Indian markets amid the escalating Ukraine crisis. On MCX, gold futures surged 1.8% to Rs53,500 per 10 gram, tracking firm global rates. In August 2020, gold had hit a record high of Rs56,200 in Indian markets. In global markets, spot gold was up 1.5% to $1,998.37 per ounce after hitting $2,000.69 earlier, the highest in 18 months. Inflows into gold-backed ETFs have seen strong inflows amid the Ukraine crisis.  Holding of the world's largest gold-backed exchange-traded fund, SPDR Gold Trust, rose 0.4% to 1,054.3 tonnes on Friday - their highest since mid-March 2021.

Silver futures on MCX today jumped 1.5% to Rs70173 per kg.

“Major risk aversion due to war supported safe-haven buying of precious metals. Despite strength in the dollar index gold and silver gained last week. Global equity markets also plunged and investors are moving from riskier assets to safe haven assets. Gold has support at $1970-1948, while resistance at $2000-2022 per troy ounce. Silver has support at $25.55-25.20, while resistance is at $26.30-26.80 per troy ounce," said Rahul Kalantri, VP Commodities, Mehta Equities Ltd.

The war in Ukraine showed no signs of abating. Russian President Vladimir Putin has vowed to press ahead with the invasion unless Kyiv surrenders, despite severe Western sanctions and widespread international condemnation.

The Russia-Ukraine crisis has battered equity markets and sent oil prices to a near 14-year high, adding further upward pressure to already high inflation.

Spot silver gained 1.7% to $26.09 per ounce, while platinum jumped 2.3% to $1,147.19.

“Russia-Ukraine tensions has caused a shift from riskier assets to safe haven and this has benefitted gold, bond, US dollar etc. Meanwhile, commodities have edged up on supply concerns as Russia is a major producer. While US and other countries have not targeted Russian exports directly so far, banking and shipping restrictions are making trades difficult while companies are reducing exposure in Russian assets fueling supply worries," Kotak Securities said in a note. 

“While market players are focusing on geopolitical developments, there is also nervousness about central bank monetary policy stance. With increased geopolitical tensions, market players have played down possibility of aggressive rate hikes. But rising inflationary pressure, on back of higher energy and commodity prices, may keep pressure on central bank to act," the brokerage said. 

Among other precious metals, palladium hit an all-time high on supply concerns from from top producer Russia, which accounts for 40% of all mined production of the metal that’s mostly used in catalytic converters in gasoline-powered vehicles. Spot palladium climbed as much as 5.3% to $3,169.46 an ounce.

Commodities may remain volatile as market players assess implication of Russia-Ukraine tensions on supply as well as global growth and central bank monetary policy stance, say analysts. With supply risks looming large, they say, the general bias for commodities, may remain higher unless there are clear efforts to de-escalate tensions.