Daily Gold Update

Source: Bill Musgrave, American Gold Exchange

Austin— Gold dipped 20 cents to close just over $1,116 as traders took profits from yesterday's after-hours surge to $1,128 following the Fed's dovish post-meeting policy statement.

The Fed left interest rates unchanged yesterday, as expected, but significantly qualified its assessment of future risks to the economy. In its post-meeting policy statement, the central bank acknowledged that "global economic and financial developments" since its last meeting have changed the "balance of risks," and that low inflation remains a big concern. Plunging oil prices and turmoil in China's financial markets lie at the heart of these "developments."

Gold quickly jumped as high as $1,128 in electronic trade yesterday following the statement's release as traders speculated that the Fed will be less inclined to raise interest rates again soon. Coming after a 5.4% climb so far this year, those gains prompted profit-taking as traders squared their books to close out the month.

The dollar extended its losses against major rivals, dropping 0.3% after the Commerce Department reported that orders for durable goods fell 5.1% last month. The sharp decline reflected a downturn in business investment and may translate into negative GDP growth for the fourth quarter.

The other precious metals also fell, with silver and platinum dropping 1.6% while platinum lost 2%.

At the Comex close: April gold dipped 20 cents to s $1,116.10; March silver gave up 23 cents, to $14.23; April platinum dropped $14.20 to $867.90; and March palladium lost $10.25 to $492 an ounce.