Gold futures fell from a 10-week high on speculation that the Federal Reserve will reduce U.S. monetary stimulus this week, trimming demand for the precious metal as a store of value.
The central bank in December cut monthly bond purchases by $10 billion to $75 billion as the economy gained. The Fed will reduce asset purchases by $10 billion at each meeting to end the program this year, according to the median of forecasts by economists this month in a Bloomberg survey. The officials begin a two-day policy meeting tomorrow.
“The market is very keen to know if the Fed will maintain the pace of the tapering over the next few months,” Tommy Capalbo, a broker at Newedge Group in New York, said in a telephone interview.
Gold futures for April delivery declined 0.1 percent to settle at $1,263.50 an ounce at 1:38 p.m. on the Comex in New York. Earlier, the price reached to $1,280.10, the highest for a most-active contract since Nov. 18. Trading was 43 percent above the average in the past 100 days for this time, data compiled by Bloomberg showed.
Silver futures for March delivery gained 0.1 percent to $19.793 an ounce on the Comex.
On the New York Mercantile Exchange, platinum futures for April delivery fell 0.5 percent to $1,421.10 an ounce.
South African government-led talks to end strikes that have crippled production from the world’s three largest suppliers resumed in Pretoria between the companies and the industry’s dominant trade union.
Palladium futures for March delivery declined 1.7 percent to $722.55 an ounce on the Nymex. The price dropped for the third straight session, the longest slump since Dec. 19.