Gold fell 2.2 per cent yesterday as equities rallied after a report showed personal spending rose more than forecast in July, spurring speculation the economic recovery would not falter and reducing demand for haven assets.

The fall sparked many Gold Bubble stories, But today it is back trading above $1825 signaling that support for the metal is long term and not a bubble.

Gold is on track to climb for an 11th year and has gained 26 per cent this year as escalating US and European debt woes and slumping equity markets heighten global growth concern.

One of the cornerstone's for gold's 48 per cent rally over the last year has been the Fed's ultra-loose monetary policy, which most recently included a pledge to leave rates near zero for the next two years and $600 billion worth of government bond purchases.

Tuesday's Fed minutes, a planned speech next week by Fed Chairman Bernanke, and developments in the euro zone debt crisis will come under heightened scrutiny by investors who are losing faith in the ability of the global economy to stave off another slowdown.

Chicago Fed President Charles Evans, a voter on this year's policy-setting committee, told CNBC he favoured some of the most aggressive policy actions on the table now being considered to boost the economy and the Fed needed to clarify its intentions

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Shayne Heffernan

Shayne Heffernan oversees the management of funds for institutions and high net worth individuals.

Shayne Heffernan holds a Ph.D. in Economics and brings with him over 25 years of trading experience in Asia and hands on experience in Venture Capital, he has been involved in several start ups that have seen market capitalization over $500m and 1 that reach a peak market cap of $15b. He has managed and overseen start ups in Mining, Shipping, Technology and Financial Services.

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