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Gold rose for the third time in the last four sessions due to the increased likelihood of stimulus from the Fed, which caused an increased demand for the metal as a store of value.
It is expected that the Open Market Committee of the Federal Reserve may consider buying assets at its meeting on September 12-13. Ben Bernanke signaled last month that the third round of so-called quantitative easing may be needed to reduce unemployment. Gold also rose as the Federal Constitutional Court in Karlsruhe will decide tomorrow whether to continue the country to make a contribution to the European stability mechanism, which is a permanent eurozone rescue fund.
We also recall that the prices of precious metals reached a six-month high on Sept. 7, after it was announced that job growth in the U.S. in August was below the expectations of many analysts, increasing the likelihood of stimulus measures this week.
Also worth noting that yesterday scrip gold assets in exchange-traded products has expanded to a record 2,480.43 tonnes.
September futures price of gold on the COMEX is now 1735.5 dollars per ounce.
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