GOLD PRICE NEWS – Gold prices rallied on Thursday amid considerable weakness in the U.S. dollar following the latest monetary policy meetings by the European Central Bank (ECB) and the Bank of England (BOE). The spot price of gold climbed by as much as $21.04, or 1.3%, to $1,678.74 per ounce in morning trading while the U.S. Dollar Index fell by 0.8% to 79.939 against a basket of foreign currencies.
Silver jumped in conjunction with the gold price, by $0.49, or 1.6%, to $30.87 per ounce. In doing so, the prices of gold and silver posted their largest single-day gains since November 6th and November 23rd, respectively. Furthermore, both precious metals moved into positive territory on a year-to-date basis, by 0.3% and 1.6%, respectively.
Strength in gold prices combined with a modest move higher in the broader equity markets to send gold stocks into the black this morning. The Market Vectors Gold Miners ETF (GDX) advanced by $1.03, or 2.3%, to $45.39 per share while the S&P 500 Index inched up by 0.2% to 1,463.47.
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Notable gold stocks moving higher included GDX components Barrick Gold (ABX), Newmont Mining (NEM), and Randgold Resources (GOLD). Shares of ABX rose by 1.6% to $34.14, NEM by 1.7% to $45.67, and GOLD by 2.3% to $96.21.
The price of gold was buoyed in part by a sharp rally in the euro and British pound after the ECB and BOE each chose to keep their respective benchmark interest rates and other accommodative monetary policies unchanged. The euro climbed by 1.2% to 1.3218 against the U.S. dollar, while the pound advanced by 0.6% to 1.6116 against the greenback in morning trading.
Mario Draghi, President of the European Central Bank, also provided the markets with a bit of surprising optimism when he stated that “Several (economic) indicators have broadly stabilized, albeit at low levels, and financial market confidence has improved significantly.”
As for the Bank of England, it decided not to expand its quantitative easing program, which currently stands at £375 billion (approximately $600 billion).
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