Gold Falls as FOMC Minutes Signal Support for Tapering TimelineJoe Richter
Gold futures in New York fell after regular trading as the Federal Reserve released minutes from its July meeting showing officials support Chairman Ben S. Bernanke’s timeline for reducing stimulus.
Federal Open Market Committee policy makers were “broadly comfortable” with Bernanke’s plan to start reducing bond buying later this year if the economy improves, with a few saying tapering might be needed soon, the minutes showed. The FOMC will probably reduce its monthly purchases at its Sept. 17-18 meeting, according to 65 percent of economists in an Aug. 9-13 Bloomberg survey.
“Officials seem to be on board with what Bernanke thinks the timeline should be,” Bart Melek, the head of commodity strategy at TD Securities in Toronto, said in a telephone interview. “It doesn’t look like you’re going to get a lot of new longs coming into the market at this point.”
Gold futures for December delivery slid 0.1 percent to $1,370.80 an ounce in electronic trading at 3:13 p.m. on the Comex in New York. The metal earlier settled down 0.2 percent at $1,370.10 at the close of regular trading.
Gold has tumbled 18 percent this year as some investors lost faith in the metal as a store of value and on speculation that the Fed may cut the $85 billion in monthly asset purchases that, along with record-low interest rates, helped send bullion on a 12-year bull run through 2012.