July 27 (Bloomberg) -- Gold climbed to a five-week high in New York on speculation that central banks around the world will take further steps to spur growth.
The U.S. economy expanded 1.5 percent in the second quarter, slower than the 2 percent gain in the first three months of the year, as a softening job market prompted Americans to curb spending, Commerce Department figures showed today. The median forecast of economists surveyed by Bloomberg News was a 1.4 percent increase. Yesterday, European Central Bank President Mario Draghi said policy makers will do whatever is needed to save the euro. Gold is headed for the biggest weekly rally in two months.
“The GDP numbers have been more or less in line with the market expectation, so people are speculating on what we will hear from the Federal Reserve,” William O’Neill, a partner at Logic Advisors in Upper Saddle River, New Jersey, said in a telephone interview. “Superman Draghi’s statement continues to support the market.”
Gold futures for December delivery rose 0.6 percent to $1,629.20 an ounce at 9:26 a.m. on the Comex in New York, after touching $1,633.30, the highest since June 19. The most-active contract is up 2.9 percent this week, the most since June 1.
Fed Chairman Ben S. Bernanke said last week that U.S. policy makers are “looking for ways to address the weakness in the economy should more action be needed to promote a sustained recovery in the labor market.”
Bullion surged 70 percent from the end of December 2008 to June 2011 as the Fed kept borrowing costs at a record low and bought $2.3 trillion of debt in two rounds of so-called quantitative easing. Policy makers are scheduled to announce a rate decision on Aug. 1.
Silver futures for September delivery rose 0.6 percent to $27.60 an ounce on the Comex.