The price of gold moved back near the $1,700-mark Tuesday morning as the U.S. dollar turned weak after Federal Reserve Chairman Ben Bernanke hinted that interest rates will stay lower for longer.
Fed Chairman Ben Bernanke said on Monday that the economy needed to grow more quickly to cut the unemployment rate. While he did not directly indicate that the Fed was set to begin another round of bond purchases, he said a continuation of accommodative policies was needed to support faster growth.
Gold for April delivery, the most actively traded contract, added $7.30 to $1,692.90 an ounce. Yesterday, gold pared losses to settle at a two-week high after comments by U.S. Federal Reserve Chairman Ben Bernanke that economic growth in the country may not be sustained.
Holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, moved up to 1,28874 tons from 1,282.69 tons.
This morning, the U.S. dollar moved back near its one-month low versus the euro, sterling and the Swiss franc, while ticking lower against the yen.
In economic news from the euro zone, Germany's consumer confidence is set to drop in April, a survey by market research group GfK showed. The forward-looking consumer sentiment index came in at 5.9, down slightly from 6 points in March. Economists were expecting it to remain stable at 6 points. Economic expectations improved slightly once again and willingness to buy almost remained at the same high level, but income expectations fell, reversing the strong improvement of the previous month
Elsewhere, the prices of silver and platinum were moving higher in morning deals.
From the U.S., the S&P/Case-Shiller home price index is scheduled to be released at 9 a.m. ET. Economists expect a seasonally adjusted 0.2 percent month-over-month drop in the 20-city composite house price index for January compared to a 0.5 percent drop in the previous month.
Later during the session, the Conference Board will release its report on U.S. consumer confidence. The report, which is based on a survey of 5,000 U.S. households, is expected to show that the consumer confidence index rose to 70.9 in March.
by RTT Staff Writer
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