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It took two words from Federal Reserve Chair Janet Yellen to reignite a gold rally.
Gold futures advanced as much as 1.6%, the most in seven sessions, after Yellen said it’s appropriate for U.S. central bankers to “proceed cautiously” in raising interest rates because the global economy presents heightened risks. She spoke Tuesday at the Economic Club of New York.
Before Tuesday, gold’s rally was sputtering, with prices gaining only six times this month, amid signs the U.S. economy may be resilient enough to withstand another interest rate increase even as global growth weakens. Higher rates reduce the appeal of gold as an alternative investment because it doesn’t offer yields or dividends. After Yellen’s speech, the odds of a rate increase by December fell to 64 percent, from 73% a day earlier, according to Fed…