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PRECIOUS-Fed Comments, Physical Demand Lift Gold 2 Pct

Tuesday, 30 Aug 2011 03:06 PM

* Gold surges by nearly 2.5 pct after Fed's Evan comments

* Physical demand picks up

(Recasts, updates prices, market activity, adds NEW YORK to dateline, second byline)

By Frank Tang and Amanda Cooper

NEW YORK/LONDON, Aug 30 (Reuters) - Gold rallied 2 percent Tuesday boosted by a disappointing U.S. consumer confidence report and by a top Federal Reserve official saying that strong and prolonged central bank accommodation is warranted given poor U.S. economic growth.

Gold accelerated gains early in the session after Chicago Fed President Charles Evans told CNBC television he backs "some of the most aggressive policy actions" now being considered by the Fed, adding the labor market, with its 9.1 percent jobless rate, looks to be in a recession. [ID:nN1E77T08F]

Other perceived safe havens, such as Treasuries, also rose and equity markets fell after data showed U.S. consumer confidence crumbled in August to its lowest in more than two years.

"Certainly, there is very little confidence among the major macro-type investors about which way the global economy is going to go over the next three to six months," said Credit Suisse Tom Kendall.

"There is very little conviction one way or the other and that is very supportive of gold," he said.

Bullion now gained as much as 8 percent in the last three sessions, largely supported after Fed Chairman Ben Bernanke raised hopes for a new market stimulus program on Friday.

Spot gold was up 2 percent at $1,822.50 an ounce by 1:22 p.m. EDT (1722 GMT). Gold fell by more than 1 percent last week, when investors stripped more than $200 off the price after it hit a record $1,911.76 on Aug 23.

U.S. gold futures for December delivery was up $34.20 at $1,825.70 an ounce.

Silver was up 1.1 percent at $41.24 an ounce. Prices at 1:22 p.m. EDT (1721 GMT)

LAST NET PCT YTD

CHG CHG CHG US gold 1825.70 34.20 1.9% 28.4% US silver 41.240 0.694 1.7% 33.3% US platinum 1852.20 27.20 1.5% 4.2% US palladium 778.50 24.55 3.3% -3.1%

Gold 1822.50 35.25 2.0% 28.4% Silver 41.24 0.46 1.1% 33.6% Platinum 1845.24 27.49 1.5% 4.4% Palladium 776.00 25.82 3.4% -2.9%

Gold Fix 1825.00 34.00 1.9% 29.4% Silver Fix 40.90 -16.00 -0.4% 33.5% Platinum Fix 1840.00 10.00 0.5% 6.3% Palladium Fix 767.00 10.00 1.3% -3.0% (Additional reporting by Lewa Pardomuan in Singapore; Editing by Bob Burgdorfer)

© 2017 Thomson/Reuters. All rights reserved.

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* Gold surges by nearly 2.5 pct after Fed's Evan comments * Physical demand picks up (Recasts, updates prices, market activity, adds NEW YORK to dateline, second byline) By Frank Tang and Amanda Cooper NEW YORK/LONDON, Aug 30 (Reuters) - Gold rallied 2 percent Tuesday...
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