width=302GOLD PRICE NEWS – The gold price fell $22.55, or 1.4%, to $1,597.55 per ounce on Wednesday ahead of the decision from today’s Fed meeting. The price of gold moved steadily lower in overnight trading, despite a lack of strength in the U.S. dollar, as it held near unchanged against a basket of foreign currencies. The SPDR Gold Trust (GLD), a proxy for the gold price and the largest precious metals ETF, tumbled $1.97, or 1.3%, to $155.19 per share in morning trading.

Silver declined in conjunction with the price of gold on Wednesday, by $0.37, or 1.3%, to $28.13 per ounce. Other precious metals headed south as well, with platinum futures sliding 1.2% to $1,463.20 per ounce and palladium down by 1.6% at $619.15 per ounce. As for cyclical commodities, crude oil retreated by 1.3% to $83.28 per barrel and copper by 0.8% to $3.40 per pound.

Gold shares faced selling pressure alongside the gold price, as the Market Vectors Gold Miners ETF (GDX) slid $0.81, or 1.7%, to $46.87 per share. Barrick Gold (ABX), the world’s largest gold mining company, dropped 1.4% to $39.73 per share. Newmont Mining (NEM), the only gold stock included in the S&P 500 Index, fell 2.0% to $49.70 per share.

In contrast to the gold sector, the broader equity markets oscillated between gains and losses. The Dow Jones Industrial Average (DJIA) inched higher by 0.1% to 12,843.72 while the S&P 500 dipped 0.1% to 1,357.01. Risk aversion, as measured by the CBOE Volatility Index (VIX), rose 0.5% to 18.49.

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The gold price suffered this morning from a growing view among market investors and economists that Ben Bernanke and his fellow central bankers will announce additional easing measures, but will not expand the Fed’s balance sheet via a third round of quantitative easing (QE3).

Josh Feinman, global chief economist for DB Advisors, the asset management unit of Deutsche Bank AG, stated that “Extending Operation Twist is the path of least resistance. It would be an extension of something we have in place, so it would be more seamless, and it doesn’t complicate exit strategies as much because it’s not expanding the balance sheet.”

PNC Financial Services Group’s chief economist, Stuart Hoffman, echoed Feinman’s forecast. “The economy still needs monetary stimulus, though QE3 seems to be a bridge too far,” Hoffman wrote in a note to clients. “Extending Operation Twist signals the Fed is on the job, yet it is not as aggressive as quantitative easing.”