Gold prices were on the rise today as expectations of stimulus action by central banks dampened demand for the US dollar, which has an inverse relationship with the yellow metal. The Federal Reserve is due to hold a policy meeting next week and it is expected that the Fed will consider using stimulus to support the economic recovery in the US, which appears to be running out of gas. After yesterday’s data from the Labor Department revealed an unexpected increase in initial jobless claims, the Federal Reserve today reported that US industrial production fell 0.1 percent last month, while its Empire State manufacturing index came in at 2.3 this month, down 15 points from May. This was also the lowest reading of the index in seven month. In addition, the University of Michigan’s consumer confidence index slumped 74.1 this month from 79.3 in May, which was blamed on the economic and political uncertainty in Europe. Greece is due to hold an election on Sunday, which will likely determine whether the debt laden country remains a member of the euro zone. Today, president of the European Central Bank (ECB) Mario Draghi said the central bank was ready to support the banking sector to stabilise the European economy. Gold traded at US$1,630/oz this afternoon, up US$7 from Thursday’s close. Other precious metals moved in the same direction as gold with silver climbing 10 cents to US$28.74/oz and platinum rising US$1 to US$1,489/oz. The top risers in the sector were: Avocet Mining (LON:AVM), up 6.5 percent at 162.46 pence at midday Polymetal (LON:POLY), up 6 percent at 877.5 pence Hochschild Mining (LON:HOC), up 5.5 percent at 488 pence Frensillo (LON:FRES), up 4.5 percent at 1,519 pence Peninsular Gold (LON:PGL), up 4.5 percent at 21 pence Alecto Minerals (LON:ALO), up 4 percent at 2.03 pence The top fallers were: Patagonia Gold (LON:PGD), down 14.5 percent at 26.5 pence at midday ECR Minerals (LON:ECR), down 11.5 percent at 0.437 pence Ariana Resources (LON:AAU), down 8.5 percent at 2.75 pence SolGold (LON:SOLG), down 7.5 percent at 4.5 pence Minera IRL (LON:MIRL), down 4.5 percent at 48.5 pence

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