Gold jumps to 7-week high as Bernanke comments awaited

Forex Pros – Gold futures were up for a seventh day on Wednesday, jumping to a seven-week high as investors awaited the Federal Reserve’s interest rate announcement and press conference later in the day.

On the Comex division of the New York Mercantile Exchange, gold futures for August delivery traded at USD1,555.95 a troy ounce during U.S. morning trade, gaining 0.54%.              

It earlier rose to USD1,557.05 a troy ounce, the highest price since May 2, when prices rose to an all-time high of USD1,577.15.

Markets awaited the conclusion of the Fed's policy setting meeting, which was to be followed with a press conference by Fed Chairman Ben Bernanke later in the day.

Mr. Bernanke was widely expected to reaffirm the bank’s pledge to hold interest rates near zero for an extended period, while investors will watch for clues regarding the current round of quantitative easing, which was due to end on June 30.

The program, which injected significant liquidity into the U.S. economy, has been a key supporting factor for gold over the past 12 months, as economic uncertainties and speculation on more monetary easing by central banks drive investors to bullion as an alternative investment.

When the Fed announced the second round of quantitative easing in November last year, gold prices hit record highs for four consecutive sessions.

Meanwhile, Greece’s parliament supported Prime Minister Papandreou’s new cabinet on Tuesday, wining the support of 155 out of 300 parliament members.

However, markets remained wary as Greek lawmakers still needed to support next week’s vote on new austerity measures, which include harsh spending cuts and new taxes over the next five years.

Elsewhere, silver for July delivery rose 0.6% to trade at an eight-day high of USD36.47 a troy ounce during U.S. morning trade, while copper for July delivery added 0.2% to trade at USD4.094 a pound.

Australia’s Perth Mint said earlier that it sold a record 10.7 million 1-ounce silver coins since July 1 of last year, 66% percent higher than the previous full fiscal year and about 10-fold more than five years earlier.




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