Gold rallies as hope of US QE3 fade
Having retreated in the last couple of days gold prices took off again today as consensus expectations shifted firmly towards there being no new round of quantative easing for the US.
The rally in gold prices was in train ahead of Fed chairman Ben Bernanke's speech at Jackson Hole today.
While another bout of QE for the US - it would be the third one - seems unlikely to be flagged, just the possibility of it in the current nervous climate is enough to create tension and uncertainty among investors. That led to a flight to the safe haven of gold.
More likely is that Bernanke will enlighten with his latest take on the state of the troubled US economy, perhaps even flag stimulative packages that are much smaller in scale than a full blown QE.
Gold for December delivery $24.70 to $1,787.90 an ounce on the New York Mercantile Exchange.
Gold prices have fallen back a hefty 11% over the last two session, giving up much of the gains that led to its intraday high of $1,917 an ounce recently.
Top gold mining risers included (midafternoon prices):
African Queen Mines (CVE:AQ) up 18 % to 16 pence
GGG Resources (LON:GGG) up 14.4 % to 21 pence
Gold Finder Explorations (LON:GFN) up 9% to 27 pence
Predictive Discovery up (ASX:PDI) 8% to 13 pence
Red Rock Resources (LON:RRR) up 8% to 7 pence
Top fallers included (midafternoon prices):
Montezuma Mining Company (LON:MZM) down 8% to 19 pence
Ariana Resources (LON:AAU) down 4.25% to 6p
Emmerson Resources (ASX:ERM) down 4.2% to 8p
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