Gold, other commodities rise; Fed’s pledge to keep interest rates low supports higher prices

Gold up as Fed keeps low-rate policy, dollar falls

NEW YORK — Gold prices are bounding higher as the Federal Reserve reaffirms its pledge to keep interest rates low for the foreseeable future.

Gold for February delivery is up $13.20 at $1,136.20 an ounce on the New York Mercantile Exchange.

As widely expected, the Fed has kept its benchmark interest rate at a level near zero, where it’s been all year, in an effort to spur lending and further support the economic recovery. Low rates mean the dollar is likely to stay weak, which should boost gold and other commodities.

Gold has been one of the biggest beneficiaries of the dollar’s decline this year because of its use as a hedge against a weak currency.