- West poised to announce sanctions against Russia
- Tensions could prompt central banks to slow tightening -analyst
- Silver hits one-month high
Feb 22 (Reuters) - Gold retreated below the $1,900 mark on Tuesday as equities pared losses despite an escalation in the Ukraine crisis that pushed safe-haven bullion to its highest in almost nine months in early trade.
Spot gold fell 0.6% to $1,895.02 an ounce by 1206 GMT, having hit its highest since June 1 at $1,913.89. U.S. gold futures fell 0.3% to $1,894.70.
Global markets clawed back losses as investors clung to hopes that Moscow's deployment of troops to two breakaway regions in eastern Ukraine will be as far Russia goes.
"There was a lot of pessimism leading into the European open," said Michael Hewson at CMC Markets UK, adding that the partial rebound in equities took some attraction out of gold.
However, Hewson also said that gold could strengthen if central banks slow their tightening cycle in response to the geopolitical backdrop.
The United States and its European allies are set to announce fresh sanctions against Russia after President Vladimir Putin recognised two breakaway regions in eastern Ukraine.
"We're seeing some profit-taking in gold also because there is obviously at this point quite an elevated risk premium baked into the price of gold," said Saxo Bank analyst Ole Hansen.
Gold is considered a hedge against inflation and geopolitical risks.
"If the Ukraine crisis escalates further, we believe that gold will remain in demand," Commerzbank analysts said in a note.
In other precious metals, spot silver rose 0.3% to $24 an ounce after touching its highest in a month at $24.30. Palladium fell 0.5% to $2,375.89, having earlier reached its highest since Jan. 31 at $2,433.
Platinum was up 0.4% at $1,078.84.
Reporting by Bharat Govind Gautam in Bengaluru Editing by Louise Heavens and David Goodman