Gold rose 1.5 percent on Wednesday, outperforming equities for the third day in a row as renewed talk of US and European monetary stimulus boosted the precious metal's appeal to investors seeking an inflation hedge. Spot gold was up 1.5 percent at $1,604.01 an ounce by 3:35 p.m. EDT (19 35 GMT), having hit a near three-week high at $1,609.91 earlier in the session.
US gold futures for August delivery settled up $31.90 an ounce at $1,608.10, with trading volume at 60 percent above its 30-day average to be the strongest in almost 2 months, preliminary Reuters data showed. Silver rose 1.4 percent to $27.32 an ounce. Confidence in the metal remains shaky, however, analysts said, with investors wary of taking profits in the traditionally volatile asset.
Gold's rise also pushed its premium over platinum above $200 an ounce for the first time since January. Platinum group metals, which are largely used as catalytic converters by the auto industry, underperformed gold. Spot platinum rose 1.1 percent to $1,393.45 an ounce, while spot palladium gained 0.8 percent to $560.65 an ounce.
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