1st LD Writethru: Gold up sharply after Fed policy meeting

Gold futures on the COMEX division of the New York Mercantile Exchange rose sharply on Thursday after the U.S. Federal Reserve took a cautious tone towards raising interest rates in its monthly meeting.

The most active gold contract for April delivery rose 17.7 U.S. dollars, or 1.54 percent, to settle at 1,169.00 dollars per ounce.

Gold rose as the U.S. central bank took a cautious tone, indicating that inflation was not where they expected it to be, but also noted that longer-term inflation expectations have remained stable. The Fed removed the word "patient" from its statement, indicating that interest rates could rise as early as June, however this was counteracted by a statement from the Fed saying that growth in economic activity slowed during the winter months, in part reflecting adverse weather conditions.

The precious metal found additional support as a report from the Philadelphia Fed showed its general conditions index fell to 5. 0 in March after a reading of 5.2 in February. Analysts note weakness in unfilled orders and new orders.

A slightly better-than-expected report from the U.S. Department of Labor put pressure on gold as jobless claims rose by only 1,000 during the March 14 week to 291,000, but analysts note that any upward momentum was dampened by the Fed's outlook statement.

Silver for May delivery rose 57.30 cents, or 3.69 percent, to close at 16.114 dollars per ounce. Platinum for April delivery added 27 dollars, or 2.47 percent, to close at 1,119.60 dollars per ounce. Endite