Daily Gold Update

Source:Bill Musgrave, American Gold Exchange

Austin— Gold gained 0.3% to close above $1,256 as the dollar receded after yesterday's somewhat dovish Fed statement., boosting demand for alternative stores of value.

The minutes from the May meeting of the FOMC, released yesterday, showed a more cautious approach to rate hikes than expected. The members agreed that it would be "prudent to await evidence" of a rebound in the second-quarter growth before another rate hike.

The central bankers also stated their plan to begin reducing the Fed's $4.5 trillion balance sheet by rolling off assets as they come to maturity. By removing stimulus this way, the Fed will be able to maintain a stable interest rate structure for longer, alleviating the need for aggressive hikes.

The dollar rolled back 0.1% against major currencies, supporting gold and other commodities denominated in it for international trade by making them less expensive in other currencies.

The dollar's slide was stemmed by a rally against commodity currencies after OPEC and other producers offered weaker cuts in production than energy markets anticipated. Oil fell nearly 4% on the news.

The other precious metals were also higher, with silver rising 0.4% while platinum and palladium added 0.6% and 1%, respectively.

At the Comex close: June gold gained $3.30 to $1,256.40; July silver added 8 cents, to $17.19; July platinum picked up $5.60, to $952.90; and September palladium jumped $7.30 to $768.50 an ounce.