- Gold prices surged yesterday after the Federal Reserve announced plans to buy $300bn in US Treasuries as the central bank expanded its efforts to counter the financial crisis.
The Fed's plans sparked concerns about the outlook for the dollar and inflation, pushing gold sharply higher.
Gold leapt from its session low of $884.10 a troy ounce to a high of $942.90, a jump of 6.6 per cent.
Later in the session, gold eased back to $939 for a gain of 2.7 per cent on the day.
Prior to the Fed's move, Alan Heap of Citigroup said government policies of quantitative easing (increasing money supply to combat deflation) could have a strong impact on the gold price.
Let's see what happened!
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