Gold, along with all commodities, appears to be benefiting from the FOMC decision to implement major quantitative easing measures on Wednesday. The Fed announced that it would expand its balance sheet by almost $1.2 trillion, which includes purchasing $300 billion in longer-term Treasuries.
Thu Mar 19, 2009 12:05pm
Gold prices sold off modestly in overnight trading, but prices held around $930 an ounce and sharply recovered just ahead of the North American trading session. Renewed pressure on the U.S. dollar at 8 a.m. EDT helped to push gold prices to session highs. Gold is trading just below $960.
In the last two days, CBOT spot prices have climbed over $75 dollars and commodity strategists are looking for further gains, as investors move into gold as a hedge against inflation.
Along with gold prices, silver has also done extremely well. Although the precious metal didn't receive much of a boost following the FOMC announcement and ended the day around $12 an ounce, it has outperformed gold on Thursday. CBOT silver futures started rallying during the European session and have been on a steady rise, jumping over 8% during the trading day.
Mike Glaser, futures broker at LaSalle Futures, said he is expecting all commodities to be underpriced as the U.S. dollar index eventually falls close to 70.0.
"I think with all this money the U.S. government is printing, inflation is going to be the main concern going forward," he said.
*The US is robbing the currencies by printing more Dollars. Each currency that gets out of the printing press robs the value of each dollar and peso that is in our bank accounts and payrolls. Indeed, they are letting the world pay for the financial errors of their people, this 'robin hoodlum' scheme will not last as other countries will slowly dump their dollars and replace it with something more stable.
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