BLBG:Gold Extends Gains on Optimism Fed to Do More to Spur Growth
Gold advanced for a third day after Federal Reserve Chairman Ben S. Bernanke said he is prepared to do more to boost economic growth if necessary, weakening the dollar and boosting the appeal of bullion as a store of value.
Spot gold gained as much as 0.3 percent to $1,647.82 an ounce and was at $1,646.73 by 11:28 a.m. in Singapore. The metal rebounded after dropping as much as 1 percent yesterday, as the dollar held a third day of losses against a six-currency basket including the euro.
Bernanke said the central bank stands ready to add to its stimulus if needed even after it left its policy unchanged yesterday and upgraded its view of the economy for this year. Additional bond-buying is still “very much on the table,” he said. That helped stoke a rally in global stocks and drove the greenback lower. The Fed bought $2.3 trillion of debt in two rounds of so-called quantitative easing from 2008 to June 2011.
“Gold regained its footing after Bernanke said the Fed is prepared to do more for the U.S. economy,” said Lynette Tan, an investment analyst at Phillip Futures Ltd.
June-delivery bullion gained 0.3 percent to $1,647.10 on the Comex in New York. Holdings in exchange-traded products backed by gold fell for a third day to 2,389.755 metric tons, the least since March 23.
The dollar fell against its peers before data tomorrow that may show U.S. growth slowed in the first quarter. The MSCI Asia Pacific Index (MXAP) climbed for a second day as data showed South Korea’s economy expanded at the fastest pace in a year.
Cash platinum, this year’s best-performing precious metal, was little changed at $1,556.50 an ounce, rebounding from its drop to a three-month low yesterday. Spot silver was little changed at $30.73 an ounce, after swinging between gains and losses. Palladium, this year’s worst-performing precious metal, rose for the first time in four days, gaining 0.3 percent to $664.25 an ounce.
To contact the reporter on this story: Glenys Sim in Singapore at gsim4@bloomberg.net
To contact the editor responsible for this story: James Poole at jpoole4@bloomberg.net
