Daily Gold Update

Source: Bill Musgrave, American Gold Exchange

Austin— Gold surged 2.5% to close at a four-month high near $1,265 after the Swiss National Bank stunned the markets by removing the euro-cap to the Swiss franc, sending investors scrambling for safe havens.

Virtually without warning, Switzerland abandoned its three-year policy pegging the value of its currency to the euro, sending the so-called Swissie skyrocketing by 20% and throwing global forex trading into confusion. To limit inflows into its suddenly stronger currency, the SNB also slashed interest rates further into the negative, to minus 0.75%.

The shocking move was made one day after European Union courts greenlighted the ECB's plan to launch quantitative easing, the Fed-style program of purchasing government bonds to drive up inflation and stimulate economic growth. Tantamount to printing money, QE will further devalue the euro and push Eurozone investors into alternative stores of value like gold and the Swiss franc.

The volatility in equity and currency markets that has dominated 2015 is expected to continue in light of the Swiss move. Gold has now gained 6% this year as investors seek safety from eroding stocks and uncertainty about central bank policies.

Frank Panizzutti, CEO of MKS Precious Metals in Dubai, forecasts that gold will average $1,292 this year and reach a high of $1,390 as stock markets continue their corrections. He gave the most accurate forecast for 2014 gold prices in the London Bullion Market Association's survey last year.

The other precious metals were mixed. Silver gained 0.7% and platinum jumped 1.9% while palladium fell 1.8%.

At the Comex close: February gold surged $30.30 to $1,264.80; March silver gained 11 cents to $17.10; April platinum jumped $23.80 to $1,262.80; and March palladium fell $14.30 to $766.35 an ounce.