Gold rose during the week, which was mostly due to Ben Bernanke’s indication that the Fed’s US$600 billion stimulus plan would stay in place, increasing the yellow metal’s appeal as an inflation hedge.
It also signals that the interest rates are likely to remain low for an extended period of time, which also bodes well for gold, which could offer better returns.
Surprisingly, the unrest in Egypt, which turned violent this week with violent clashes erupting between the protesters and supporters of President Hosni Mubarak, has made little impact on gold prices as traders were opting for the US dollar for wealth protection.
Gold last traded at US$1,348/oz, up from US$1,338/oz a week ago.
Silver rose from US$28.01/oz to US$29.14/oz, while platinum advanced from US$1,793/oz to US$1,843/oz.
Mining stocks were in demand this week.
Randgold Resources (LON:RRS) rose from 4,847 pence to 4,980 pence, while fellow gold producer African Barrick Gold (LON:ABG) climbed from 509 pence to 520 pence.
Silver miner Fresnillo (LON:FRES) advanced from 1,316 pence to 1,418 pence and platinum miner Lonmin (LON:LMI) surged from 1,674 pence to 1,815 pence.
Gold prices rise on Bernanke comments
Last updated: 10:05 05 Feb 2011 EST, First published: 11:05 05 Feb 2011 EST