Daily Gold Update

Source: Marketwatch

San Francisco— Gold futures rose Wednesday with the Federal Reserve's decision to cut the benchmark federal funds rate for the first time in more than four years and ongoing dollar weakness helping to lift prices to a close near $730 an ounce. After the Fed cut both the fed funds rate and the discount rate by a half point on Tuesday, gold futures rallied as high as $735.50 an ounce in electronic trading, touching their highest level since 1980. Gold for December delivery continued higher, reaching a high of $735 in electronic trading Wednesday. It closed $5.80, or 0.8%, higher at $729.50 an ounce for the regular New York Mercantile Exchange session.

Ned Schmidt, editor of the Value View Gold Report, came up with three conclusions following the Fed's decision: "One, U.S. economy is sicker than thought. Two, FOMC [Federal Open Market Committee] is intellectually bankrupt. Three, dollar will be trashed in an attempt to bailout U.S. banks and housing sector…. Given those, we can certainly start talking about $800 gold," he said in emailed remarks. See full story.