Gold futures fell the most in a week after Federal Reserve Chairman Ben S. Bernanke provided no specific plans for more purchases of U.S. debt to bolster the economy.
Bernanke told lawmakers yesterday that policy makers are studying options for further easing. The dollar rebounded against a basket of currencies, eroding the appeal of precious metals as alternative investments.
“Gold came under pressure as the dollar resumed its ascent in the wake of an uncooperative Fed,” Jon Nadler, an analyst at Kitco Inc., a precious-metal refiner and research company in Montreal, said in a report.
On the Comex in New York, gold futures for August delivery fell 1.2 percent to close at $1,570.80 an ounce at 1:42 p.m., the biggest drop for a most-active contract since July 6. The price has dropped 17 percent from the record settlement on Aug. 22.
Gold surged 70 percent from the end of December 2008 to June 2011 as the central bank kept borrowing costs at a record low and bought $2.3 trillion of debt in two rounds of so-called quantitative easing. Policy makers are scheduled to announce a rate decision on Aug. 1.
Silver futures for September delivery dropped 0.8 percent to $27.095 an ounce. The metal has slumped 33 percent in the past 12 months.
On the New York Mercantile Exchange, platinum futures for October delivery fell 1.2 percent to $1,404.20 an ounce. Palladium futures for September delivery slipped 1 percent to $577.55 an ounce.