Gold Firms In Line with Euro; Stimulus News Awaited
Gold firmed on Tuesday as the dollar retreated, but held within this month’s narrow range as investors awaited news on central bank action to stimulate growth, which could boost liquidity, keep interest rates low, and fuel longer-term inflation fears.
Speculation that the Federal Reserve in particular could launch another round of gold-friendly stimulus measures like quantitative easing – printing money to buy bonds – has helped support bullion prices above $1,600 an ounce.
A pledge by the European Central Bank that it too would launch measures to shore up the euro, consequently weighing on the dollar, has also boosted gold. However, it has struggled to build on those gains in the absence of concrete action.