Gold News & Info

Source: Dr. Bill Musgrave, American Gold Exchange

Austin— Gold gained 0.5%, posting its fifth winning session out of six, as downbeat U.S. economic data underpinned speculation that the Fed will maintain monetary stimulus to spur the recovery. Retail sales rose by a scant 0.4% in June, around half of most forecasts, and business inventories grew more than expected as consumers cut back and the expansion became more sluggish. GDP growth is now projected to be only 1.1% in the second quarter, down from 1.4% in earier forecasts.

Gold fell under pressure in recent weeks on worries that the Fed may soon reduce quantitative easing, its program of buying $85 billion in long-term bonds each month. Fed Chair Ben Bernanke soothed those fears last week by saying that �highly accommodative monetary policy for the foreseeable future is what�s needed in the U.S. economy." Taken as explicit support for ongoing easing, his statement put a floor under the metals and boosted bullish sentiment. Hedge funds have increased their bets on higher gold prices for the second straight week while physical demand, which remained strong throughout the sell-off, continues to gain momentum, especially in Asia. China's physical gold imports rose 40% in May, and are on pace to double last year's total of 1,139 tons.

The other precious metals tracked gold higher. Silver added 0.2% while platinum and palladium climbed 1% and 1.4%, respectively.

At the Comex close: August gold gained $5.90 to $1,283.50; September silver added 5 cents, to $19.84; October platinum climbed $14.50 to $1,421.40; and September palladium picked up $9.25 to $732.15 an ounce.