Gold prices turned higher on Tuesday as safe-haven demand increased after the US Federal Reserve said it would buy more government debt to boost a sputtering economic recovery. The significant policy shift by the central bank, combined with record-low interest rates and stimulus spending, spurred investors to buy bullion as a hedge against inflation.
Spot gold was at $1,204.15 an ounce at 3:43 pm EDT (1943 GMT), up from $1,200 late in New York on Monday. US gold futures for December delivery were up $3.80 at $1,206.40 an ounce, after settling at $1,198 prior to the FOMC statement. Among other precious metals, silver was at $18.35 an ounce versus $18.29, platinum was at $1,537.50 an ounce versus $1,540 and palladium was at $473.50 versus $475. The platinum-gold ratio - a measure of how many ounces of gold are needed to buy an ounce of platinum - eased to a 2-1/2 week low of 1.28, showing gold was becoming increasingly expensive compared to platinum.