Wednesday was a rough day for gold in the wake of a disappointing Fed statement that both underscored national economic troubles and simultaneously failed to announce another round of quantitative easing.
Silver and platinum also dropped on the news.
"You can say that immediate QE is off the table. I will probably not be surprised to see them not do anything in September," said Frank McGhee, head precious metals trader of Integrated Brokerage Services LLC.
Wall Street didn’t fare much better, since the Fed didn’t mention anything about extending its current low rates; instead, they stuck to already-known statements about late-2014.
Spot gold dropped 0.7 percent to $1,602.20 at around 3PM Eastern, picking up after the crash toward $1,590 right after the Fed’s announcement. Bullion also sank for the third consecutive day as hopes of another round of quantitative easing faded.
December gold futures decreased $7.30 to $1,607.30 per ounce; silver fell by 1.6 percent to rest at $27.47 per ounce.
However, the news isn’t all terrible, as gold investment demand showed some robustness.
The SPDR Gold Trust—the world’s biggest gold-backed fund traded on the exchange—showed that its holdings have gone up by 3.32 tons as of Tuesday.