Updated from 10:29 a.m. EDT with settlement prices
NEW YORK (TheStreet) -- Gold prices fell Wednesday after the Federal Reserve's latest monetary-policy announcement revealed no plans to stimulate the economy.
Gold for December delivery fell $3 to $1,604.30 an ounce at the Comex division of the New York Mercantile Exchange. The gold price traded as high as $1,621.80 and as low as $1,598 an ounce, while the spot price was down $16.20. The latest settlement came mid afternoon on Wednesday at $1607.30.
"Last week we did expand the [trading] range, we moved to the higher parts of that range, and it was very disappointing," said Stanley Dash, vice president of applied technical analysis at TradeStation Securities. "There was no follow through, it began to get a little questionable the last day or two ... and we're paying the price here with the selloff."
The Fed said Wednesday that economic conditions were likely to warrant low levels of the federal funds rate at least through late 2014, but didn't signal immediate easing efforts. The Federal Open Market Committee said it would "closely" monitor developments and provide accommodation as needed -- which is similar to its policy statements of the past few months.
for September delivery fell about 38 cents to settle at $27.54 an ounce, while the U.S. dollar index
was up 0.4% to $83.02.
Gold investors were awaiting possible QE3 Wednesday from the Fed after a report
last week suggested that Fed members had moved closer to quantitative easing efforts.
"Aggressive action by the Fed ... could give gold another quick boost and trigger the resumption of a durable bull-market advance," Jeffrey Nichols, senior economic adviser at Rosland Capital, wrote before the announcement in a research note.
On the other hand, Nichols wrote that Fed failure to adopt aggressive monetary stimulus could quickly sink gold below $1,600 an ounce.
The eurozone also has remained freshly in the minds of traders a week after European Central Bank President Mario Draghi said he was committed to do whatever he would take to hold the currency zone together. After the Fed rumors and Draghi comments, gold burst through the psychological $1,600 mark and gained 2.5% last week.
China's July manufacturing PMI came in late Tuesday at 50.1, below analysts' expectations. Though the number showed manufacturing there had avoided contraction, it still revealed a drop from 50.2 the previous month. China has already shown willingness to take up easing monetary policies, and more cooling hasn't taken that option off the table
Gold-mining stocks closed mostly lower Wednesday. Kinross Gold (KGC)
finished down more than 4% and Goldcorp (GG)
closed off about 1.5%.
Among other mining stocks, Barrick Gold (ABX)
and Eldorado Gold (EGO)
closed down more than 1% and Agnico-Eagle Mines (AU)
was up less than 1%.
-- Written by Joe Deaux in New York.
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