The price of gold showed a muted reaction to the release of the Producer Price Index (PPI)

GOLD PRICE NEWS – The gold price, at $1,785 per ounce, traded near unchanged Wednesday following the news that producer prices rose more than anticipated. The price of gold showed a muted reaction to the release of the Producer Price Index (PPI), which rose 0.2% month over month and 7.2% year over year – both slightly hotter than a Bloomberg survey of economists. Commodities moved higher across the board with crude oil rising 1.5% to $87.99 per barrel and copper advancing 0.6% to $4.04 per pound. Silver rose above $40, climbing $0.15 to $40.05 per ounce.

The gold price supported its gains yesterday after German Chancellor Angela Merkel and French President Nicolas Sarkozy released a set of proposals designed to bring more fiscal unity to the euro zone. Although the proposals called for the creation of a Eurozone President and for each nation to adopt a balanced budget, the plan was quite short on details. Moreover, the proposals did not suggest specific measures to alleviate the PIIGS’ debt woes or to improve the outlook for their economies. These shortcomings left investors disappointed, reflected in the broader markets’ slide and the rally in the price of gold.