Gold falls after Bernanke testimonyJuly 18 2012, 3:34pm
Gold prices dropped following yesterday’s testimony to the US Congress from Federal Reserve chairman Ben Bernanke.
While Bernanke acknowledged that the recovery has been slugging and progress in reducing the jobless rate has been “frustratingly slow”, he did not mention the possibility of a third round of quantitative easing.
More QE would weaken the US dollar, which has an inverse relationship with gold, and boost the yellow metals’ appeal as an inflation hedge.
Bernanke will speak before the US Congress again later today.
Gold received a little support from today’s positive US data, which revealed that industrial production rose 0.4 percent last month and housing starts jumped more than expected, reducing demand for the safe-haven US dollar.
Gold traded at US$1,578/oz this afternoon, down US$4 from Tuesday’s close. Other precious metals also fell with silver dropping 10 cents to US$27.21/oz and platinum declining US$5 to US$1,409/oz.
Today’s top risers n the sector were:
Arian Silver (LON:AGQ), up 6 percent at 11.3 pence at midday
Avocet Mining (LON:AVM), up 3 percent at 69.75 pence
Medusa Mining (LON:MML), up 3 percent at 314.44 pence
Hambledon Mining (LON:HMB), up 2.5 percent at 1.51 pence
Fresnillo (LON:FRES), up 2 percent at 1,439 pence
The top fallers were:
Norseman Gold (LON:NGL), down 17.5 percent at 2.77 pence at midday
Vatukoula Gold Mines (LON:VGM), down 7 percent at 28.7 pence
GoldStone Resources (LON:GRL), down 5.5 percent at 3.66 pence