Gold and Silver Climb Higher as Fed Keeps the Printing Presses Going

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On Wednesday, gold (NYSEARCA:GLD) futures for April delivery, the most active contract, increased $18.90 to settle at $1,681.60 per ounce, while silver (NYSEARCA:SLV) futures for March jumped 99 cents to close at $32.18.

Both precious metals received support as the Federal Reserve announced it will continue with its $85 billion in monthly bond buying, which involves mortgage-backed securities and longer-term Treasury securities. The central bank also noted that growth stalled and the unemployment rate is still too high.

The Federal Reserve explains, “Information received since the Federal Open Market Committee met in December suggests that growth in economic activity paused in recent months, in large part because of weather-related disruptions and other transitory factors. Employment has continued to expand at a moderate pace but the unemployment rate remains elevated.”

The latest GDP report from the Commerce Department also showed the economy contracted 0.1 percent in the fourth quarter.

By the end of the day, the SPDR Gold Trust (NYSEARCA:GLD) gained 0.75 percent, while the iShares Silver Trust (NYSEARCA:SLV) jumped almost 2 percent. However, gold miners (NYSEARCA:GDX) such as Barrick Gold (NYSE:ABX) and Yamana Gold (NYSE:AUY) finished in the red. Silver names such as Hecla Mining (NYSE:HL) and Endeavour Silver (NYSE:EXK) declined 1.31 percent and 0.97 percent, respectively.

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Disclosure: Long EXK, AG, HL, PHYS

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