The U.S. dollar turned lower and gold futures rebounded after Federal Reserve Chairman Ben Bernanke testified on the outlook for the economy before the Senate Budget Committee Tuesday morning.
There, Bernanke provided the identical testimony as he gave last week to the House of Representatives Budget Committee, which GoldAlert discussed at that time.
More importantly for today, however, was the fact that the Fed Chairman did not comment on last Friday’s better than expected non-farm payroll report – which was announced after last week’s testimony. The encouraging jobs data stood in stark contrast to the gloomy economic picture depicted by the Fed at last month’s FOMC meeting – where the central bank decided to extend the timeframe for its zero interest rate policy from mid-2013 to late-2014.
As such, the fact that Bernanke did not discuss the employment report served to reinforce his dovish monetary policy stance, and thus helped to send the dollar lower and gold higher.
In late morning trading, the U.S. Dollar Index fell 0.6% to 78.575 and COMEX gold futures advanced $16.20, or 0.9%, to $1,641.10 per ounce. Silver turned higher as well, by $0.20, or 0.6%, to $33.95 per ounce.