NEW YORK ( TheStreet ) -- Gold and silver prices rallied Wednesday after the Federal Reserve's interest rate announcement, but gave up some gains during Ben Bernanke's press conference.

Gold for August delivery added $7 to settle at $1,553.40 an ounce at the Comex division of the New York Mercantile Exchange. The gold price has traded as high as $1,559.30 and as low as $1,542 while the spot gold price was slightly lower, according to Kitco's gold index.

Silver prices rose 36 cents to close at $36.75 an ounce while the U.S. dollar index was adding 0.12% at $74.72 and the euro was flat.

Gold prices stayed firm after the Fed's interest rate announcement but then lost steam during Ben Bernanke's second press conference. Gold prices were currently up $4.90 while spot gold turned negative.

The Fed, as expected, will leave rates low for an "extended period of time"," which as Tony Crescenzi, strategist at Pimco, points out means at least two more FOMC meetings until a tightening cycle will begin, late September at the earliest. Bernanke, himself, said this could mean two to three more meetings.

The Fed also acknowledged the soft patch in the economy, rising unemployment and higher inflation but the governors believe employment will slowly recover and long term inflation expectations will remain stable.

The Fed plans to exit QE2 at the end of June, keep reinvesting profits into Treasuries, which are estimated to be between $12 billion and $16 billion, didn't reject more money printing but didn't green light it either. The Fed also lowered its 2011 growth target to 2.7%-2.9% down from 3.1% to 3.3%. Expectations are that unemployment will stay between 8.6% to 8.9% for 2011 while core inflation, excluding food and energy prices, will grow to 1.8%.

Oliver Pursche, co-portfolio manager of the GMG Defensive Beta Fund, says the Fed reiterated the speech that Bernanke gave two weeks ago and really isn't a game changer, but Pursche does think that Bernanke left the door open for QE3 in his press conference.

"I think he left the door slightly open to revist the potential for monetary easing" should the conditions causing the downturn not be transitory. Pursche thinks the Fed will raise interest rates, at the earliest, in the second half of 2012.

In terms of gold, Pursche says that Bernanke "may not have spurred a rally in gold, but it has taken the downside risk off the table ... there is a certain floor being built in."

Pursche says gold is being viewed as a safe haven asset right now arguing that its rally Wednesday is more a product of the "overnight news out of Greece and continued anxiety that despite a vote of confidence the likelihood of material reforms shaping up in the next two or three weeks ... is unlikely." Pursche believes that markets will see money flow out of the euro and euro denominated assets and into gold.

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