Gold News & Info

Source: Dr. Bill Musgrave, American Gold Exchange

Austin— Gold slipped 0.4% to settle at $1,327 on lingering concerns that the Fed may begin to taper monetary stimulus in October. St. Louis Fed President James Bullard said on Friday that reductions in quantitative easing, the Fed's $85 billion-per-month bond-buying program, could begin next month if unemployment data does not weaken. Relief from the threat of a taper caused gold to rally 4.7% last Wednesday, its biggest one-day gain in four years, after the FOMC surprised the markets by holding stimulus at current levels. QE supports higher gold prices by devaluing the dollar and increasing the risk of long-term inflation.

Anxious traders are pricing a taper back into the markets despite today's remarks by two senior Fed officials emphasizing that the economy still needs help. New York Fed President William Dudley said in speech at Fordham University that the economy is still too weak for reductions in QE, with headwinds likely to remain until early next year. Separately, Atlanta Fed Dennis Lockhart warned that the economy may be losing its "mojo," especially in creating jobs. Both want to see improvements in the labor market before slowing asset-purchases. Equities, commodities and precious metals fell in unison on the renewed taper worries. Silver slid 0.3%, platinum fell 0.5%, and palladium dropped 0.6%.

At the Comex close: December gold slipped $5.50 to $1,327; December silver slid 7 cents to $21.86; October platinum dropped $6.70 to $1,425.90; and December palladium dropped $4 to $717.95 an ounce.