The price of Gold dropped to the lowest level in almost two weeks, following the Federal Reserve’s (Fed) announcement to begin the tapering of its monthly bond purchases as the world’s largest economy is improving so as the U.S jobs market.
Bullion futures prices dropped 1.12%, trading at $1.221.90 an ounce at the time of writing. Gold futures for February delivery fell 1.3% to $1,219.40 on the Comex. Silver futures declined 3.61% to touch $19.335 an ounce.
The Federal Reserve (Fed) concluded its two-day meeting by announcing to begin tapering its $85 billion monthly asset purchases to $75 billion.
Holdings in the world’s largest gold-backed exchange-traded fund, SPDR Gold Trust, came in at 812.62 tones on Wednesday, marking its lowest level since January 2009.
The US dollar index, which measures the strength of the US dollar against a basket of six major currencies, edged 0.62% higher at 80.603 points.
Gold – Federal Reserve Tapering
On Wednesday, the Federal Reserve (Fed) concluded its two-day meeting with an announcement to begin scaling-back on the central bank’s monthly asset purchases by reducing it by $10 billion.
“Reflecting cumulative progress and an improved outlook for the job market, the committee decided today to modestly reduce the monthly pace at which it is adding to the longer-term securities on its balance sheet,” Fed Chairman Ben S. Bernanke said on Wednesday.
The Federal Reserve’s purchases will be divided into $35 billion in mortgage bonds and $40 billion in Treasuries starting from January next year, the Fed Chairman confirmed.
Gold – US Data
The Department of Commerce confirmed the annual housing rate started from a 22.7% high to 1.091 million in November, compared to analysts’ forecast of a 954.000 unit pace. While in October, it rose to 889,000.
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