Gold climbed the most in three weeks after the Federal Reserve said it sees “exceptionally low” interest rates through at least late 2014. Silver, platinum and palladium also advanced.
“The Committee expects to maintain a highly accommodative stance for monetary policy,” the Federal Open Market Committee said in a statement in Washington today. “Economic conditions - - including low rates of resource utilization and a subdued outlook for inflation over the medium run -- are likely to warrant exceptionally low levels for the federal funds rate at least through late 2014.”
“We saw an immediate reaction in gold,” said Michael A. Gayed, the chief investment strategist who helps oversee $150 million at New York-based Pension Partners LLC in a telephone interview. “People are betting that at some point the economy will face inflationary pressures because of the low interest rate.”
Gold futures for February delivery climbed 2 percent to $1,700.80 an ounce at 1:18 p.m. on the Comex in New York. Earlier, prices had dropped as much as 0.9 percent.
Silver futures for March delivery in New York jumped 3.6 percent to $33.17 an ounce. Earlier, prices jumped to $33.32, the highest level since Dec. 2.
On the New York Mercantile Exchange, platinum futures for April delivery advanced 1.7 percent to $1,576 an ounce. Palladium futures for March delivery climbed 1.8 percent to $693.10 an ounce.
