ET:Gold near 11-month high as stimulus set to boost demand
LONDON: Gold today traded near the highest level in almost 11 months on speculation that central-bank stimulus from the US to Europe and Japan will boost demand for the metal as a store of value.
The precious metal increased by 0.3 per cent to USD 1,796.10 an ounce, the highest level since November 14, before trading at USD 1,791.48 as investors' holdings rose to an all-time high.
The European Central Bank is ready to start buying the bonds of indebted euro nations as soon as the necessary conditions are fulfilled, President Mario Draghi said, after policymakers left the benchmark interest rate at a historic low of 0.75 per cent.
Gold gained 11 per cent in the third quarter, the most since June 2010, as the US Federal Reserve announced a third round of monetary stimulus.
Bullion held in exchange-traded products expanded 11.14 tonnes, or 0.4 per cent, to a record 2,565.472 tonnes.
Some investors buy bullion as a hedge against inflation and a weaker dollar, and the metal generally earns returns only through price gains, increasing its allure as interest rates decline.
