(Bloomberg). — As tensions over Ukraine escalated, gold traded at its highest point in eight months. This boosted demand for this haven asset.

The Kremlin stated that separatist leaders from eastern Ukraine made appeal to Russia to help them defeat Ukrainian forces. This dramatic move could have a significant impact on Moscow’s plans to send troops to the region. The U.S. had previously increased sanctions against Russia.

Bullion is being supported by the crisis in Eastern Europe. Prices are pushing higher, despite expectation that the Federal Reserve would raise interest rates in March. 

The United States added additional sanctions to President Joe Biden’s Wednesday announcement, targeting the Nord Stream 2 pipeline builder and the corporate leaders. The White House announced this package a day before after Russian President Vladimir Putin made an announcement recognizing the independent state of Ukraine’s breakaway territories.

The request for Moscow’s help from two breakaway regions comes as Putin sustains a large troop buildup on the Ukraine border. According to the U.S., there are approximately 150,000 troops in the region and significant amounts of military equipment. Russia denies that it intends to invade.

“The market has yet to see the kind of news that would galvanize the gold price to a new high,” said Nicholas Frappell, global general manager at Sydney-based ABC Bullion. “Putin’s recognition of the two breakaway regions has kept a bid under gold and the market is trading risk off with equities lower. If prices rise above $1,915, the emphasis is bullish, and expectations would tend toward the $1,935-$1,960 level.”

After climbing 0.6% on Wednesday, prices rose 0.1% to $1.910.90 per ounce by 8:29 in Singapore. The prices had reached $1,914.25 Tuesday morning, their highest intraday level since June 1. The Bloomberg Dollar Spot Index did not change. The silver and platinum indexes remained stable while the palladium price rose.

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