Gold declined after Federal Reserve Chairman Ben S. Bernanke held off on increasing stimulus measures, lowering demand for the precious metal.
The Federal Open Market Committee “will closely monitor incoming information on economic and financial developments and will provide additional accommodation as needed to promote a stronger economic recovery and sustained improvement in labor market conditions in a context of price stability,” it said today at the conclusion of a two-day meeting. Earlier, a report by ADP Employer Services showed companies in the U.S. added more workers than projected in July.
“We saw a knee-jerk reaction, but the stage was already set after we saw strong ADP numbers,” Donald Selkin, the New York-based chief market strategist at National Securities Corp., which manages about $3 billion of assets, said by telephone. “There may be some announcement from the Fed either later this month or next.”
Gold futures for December delivery slid 0.6 percent to $1,605.10 an ounce in electronic trading at 3:20 p.m. on the Comex in New York. The prices settled earlier at $1,607.30, down 0.5 percent.
Bullion surged 70 percent from the end of December 2008 to June 2011 as the U.S. central bank kept borrowing costs at a record low and bought $2.3 trillion of debt in two rounds of so-called quantitative easing.
The European Central Bank policy makers convene tomorrow. President Mario Draghi said last week policy makers will do whatever is needed to save the euro.