Gold futures on the COMEX division of the New York Mercantile Exchange fell on Wednesday as investors speculated that strong U.S. GDP data gave the U.S. Federal Reserve backing to tighten its monetary policy earlier than expected.
The most active gold contract for December delivery fell 3.6 U. S. dollars, or 0.28 percent, to settle at 1,296.9 dollars per ounce.
The U.S. economy grew at an annual rate of 4.0 percent in the second quarter after unexpectedly shrinking in the first three months this year, the U.S. Commerce Department announced earlier Wednesday. That confirmed the Fed's view that the world's largest economy would strongly bounce back after the severe winter weather ended.
As widely expected, the U.S. central bank on Wednesday cut its monthly asset purchases to 25 billion U.S. dollars from 35 billion dollars, leaving it on track to end the program later this year. Although the Fed maintained a dovish tone by saying that it would keep interest rates low for a "considerable time" after ending purchases, some analysts believe if the economy remains strong in coming months, the Fed will likely move forward its first rate increase to the first half of next year.
Silver for September delivery gained 1.4 cents, or 0.07 percent, to close at 20.597 dollars per ounce. Platinum for October delivery lost 2.6 dollars, or 0.18 percent, to close at 1,481.9 dollars per ounce.