() New York – Spot Gold rose to a record high of $1,395.90 Thursday after the Federal Reserve said it would buy more debt, causing inflation fears to take a front row seat in the market.

The dollar fell to an 11-month low against major currencies as precious metals trading became furious after the Fed announced that it was buying $600 billion of U.S. Treasuries through June in an attempt to spur growth.  But what grew was fear of inflation and a weaker U.S. currency that prompt commodities prices to rise against the slumping greenback.

December gold finished the day at $1,390.80 for a gain of $8.10 or 0.59%.  Spot Silver also reacted to the surge in gold prices, rising to a record high of its own at an ask price of $26.40.

In the last thirty days, spot gold and silver have advanced 3.50% and 14.87%.

With gold just under the psychological leg of $1400 per ounce, investors at apt to push gold higher.

StandardBank precious metals analyst Walter de Wet agreed, saying “The precious metals market has taken the Fed’s quantitative easing in its stride.”  De Wet noted that on the high end of resistance gold would break higher if it passed the $1,390 threshold.

Gold stocks also shined with the Gold Composite up 4.19% at 1244.4.

Shares of Richmont Mines (AMEX: RIC) shot up 61 cents, or 13%, to close at $5.28 after the company announced a 25% jump in third quarter revenue Thursday with gold sales of 18,084 ounces at an average price of $1,244 per ounce for the period.

Minco Gold (AMEX: MGH) rose nearly 17 cents, or 12.5%, to set a new 52-week high at the close of $1.53 on nearly 10 times its average trading volume, though no news has come out of the Company since announcing an expansion of its mineralized zone at its Yejiaba property in China.

Cardero Resource Corp. (AMEX: CDY) rose 15 cents, or 12.10%, to close at $1.39. which was pumped by bullish outlook towards companies with investments in China metals.

Higher gold prices helped boost Yamana Gold (NYSE: AUY), which closed up 70 cents, or 6.5%, after the company announced raising its dividend 200% and declaring a special dividend.

Amongst the junior gold mining companies, the market saw Nevada-based Gryphon Gold Corp. (Otcbb: GYPH; TSX: GGN) release news this week about the U.S. Forestry Service clearing the way for the company to begin construction of its heap leach pad at its Borealis Property.  Gryphon has slated a July 2011 date for becoming a producer.  Once in full production Gryphon will be producing 50,000 ounces per year, making it the 6th largest gold producer in the state.  Gryphon closed down 1 cent at $0.25 after reaching a new 52-week hi of $0.29 days ago.

Entourage Mining Ltd. (Otcbb: ENMGF) gave up 5 cents, or 25%, to close at $0.15 as investors await news on its TSX Venture listing and financing to commence its phase two drilling program at its Pires Property in Central Brazil.  The early-stage exploration miner has been on ‘ radar since the company revealed its most recent plans.

Similar Posts:

• Gold stocks poised for a come back
• Silver sector leads industry groups Wednesday as spot silver rises 3%
• Junior Miner Announces Impressive Drill Results In Quebec
• Where have all the investors gone?
• Gold drops 4%

Tags: Dollar, Inflation Fear, Record High