Gold and silver prices were volatile and sharply lower Wednesday morning as Federal Chairman Ben Bernanke was testifying before Congress. Also impacting gold and silver trading, the European Central Bank conducted its second Long Term Refinancing Operation, and the Bureau of Economic Analysis revised fourth-quarter 2011 GDP upward.
Spot gold was down 2.78% at 11 a.m., having traded as high as $1,788 and as low as $1,718.10. The London morning reference price was fixed at $1,788, $7 per ounce higher than Tuesday’s afternoon reference price, according to Kitco market data.
Spot silver was showing a 2.79% loss, bid at $35.90 with an ask price of $36. The morning high as of time of writing was $37.62 and the low was $35.38. Wednesday’s reference price was set at $37.23 in the London a.m., a full $1.63 cents per ounce above Tuesday’s reference price.
The Bureau of Economic Analysis revised its Q4 GDP estimate to 3% from an initial 3.8% last month. The U.S. economy grew at a 1.8% rate in Q3 2011, according to the BEA.
European banks tapped the European Central Bank for 529.5 billion euros ($712.4 billion) in low-cost, three-year loans in the second round of the ECB’s Long-Term Refinancing Operation. Looking to avoid another credit crunch, the three-year funding comes with interest rates as low as 1%.
The 500 million euros ($672.5 billion) of liquidity added in the first-round LTRO operation has successfully