As reported by Bloomberg’s Debarati Roy, Gold futures advanced, extending a rally to a record for the second straight day, as the Federal Reserve pledged to keep its benchmark interest rate low at least through mid-2013.
Gold retreated from the settlement after equities rallied as investors studied today’s Fed policy statement. The metal has jumped 45 percent in the past year following bond buybacks by the central bank during two rounds of so-called qualitative easing, combined with the lowest borrowing costs ever.
“The anxiety premium for gold remains,” Adam Klopfenstein, a senior strategist at MF Global Holdings Ltd. in Chicago, said in a telephone interview. “People are disappointed that there was no mention of QE3, but the statement shows that the government is not willing to go too excessive to stimulate the economy.”