Daily Gold Update

Source: Bill Musgrave, American Gold Exchange

Austin— Gold surged 1.3% to close above $1,237, then pushed higher to $1,245 in electronic trading, after Fed Chair Janet Yellen made a case for keeping interest rates lower for longer.

In today's much-anticipated speech to the Economic Club of New York, Yellen defended the Fed's decision to move slowly in tightening monetary policy and signaled her disinclination to increase interest rates any time soon.

Warning that "global developments have increased the risks" to U.S. growth, Yellen said it is "appropriate for the Committee to proceed cautiously in adjusting policy." She also expressed her doubt that the uptick in core inflation since the start of the year is sustainable.

Without mentioning names, the Fed Chair seemed to push back against recent statements by several Fed officials suggesting a rate hike may come as soon as April. The prospect of imminently higher rates caused the dollar to rally last week, pressuring gold and other commodities denominated in it for international trade.

The dollar fell hard after Yellen's speech while U.S. equities rallied to the highest levels this year. Yields on U.S. Treasury bonds also fell.

The other precious metals tracked followed gold higher. Silver picked up 0.3% while platinum and palladium gained 2.2% and 1.1%, respectively.

At the Comex close: June gold surged $15.50 to $1,237.50; May silver added 4 cents, to $15.23; July platinum jumped $20.80 to $967; and June palladium picked up $6.20 to close at $573.20 an ounce.