Commodity News

Gold and silver surged today after the Federal Reserve refrained from trimming its stimulus program. While some analysts were speculating about such decision previously, most market participants believed that the Fed would perform some form of quantitative easing tampering.

The US central bank announced today that it keeps the size of monthly asset purchases at $85 billion and the unemployment threshold to consider monetary tightening at 6.5 percent. The Fed revised the expected range for economic growth this year from 2.3 percent — 2.6 percent down to 2.0 percent — 2.3 percent, while the forecast for 2014 was lowered from 3.0 percent — 3.5 percent to 2.9 percent — 3.1 percent.

The news made gold bulls optimistic, but it is too early for them to become relaxed. Fed Chairman Ben Bernanke said in the press-conference after the meeting that QE tampering remains possible. Some specialists speculated that stimulus reduction will not happen till December as earlier gatherings will not be followed by press-conferences, while policy makers will surely want to comment on changes to monetary policy. But Bernanke explained that absence of press-conference does not guarantee absence of policy changes.

Futures for delivery of gold in December surged as much as $54 (4.13 percent) to $1,361.6 per troy ounce as of 22:54 GMT on COMEX today. Contract for silver soared $1.41 (6.52 percent) to $22.97 per ounce.

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