Bullion prices slip on Wednesday

Gold prices traded solidly lower and hit a three-week low

Bullion prices slipped on Wednesday, 29 October 2014 at Comex ahead of what is expected to be the final goodbye to the Federal Reserve's bond-buying stimulus program. Gold prices traded solidly lower and hit a three-week low on Wednesday afternoon, in the immediate aftermath of the latest FOMC statement that was deemed a bit hawkish on U.S. monetary policy. The U.S. dollar index also surged on the FOMC statement, which also worked to put downside price pressure on gold.

Gold for December delivery fell $4.50 to settle at $1,224.90 an ounce.

December silver dropped 4 cents to $17.26 an ounce.

A day earlier, gold took some hesitant steps forward to halt a modest losing streak as investors jumped back into equities in a big way.

The Federal Open Market Committee (FOMC) minutes hint the U.S. central bank could move to raise interest rates sometime in 2015, based upon the committee's somewhat surprising upbeat assessment of the U.S. economy. The market place was leaning in the direction of an FOMC statement that favored the dovish campeven though the Fed did end its monthly bond-buying program (quantitative easing) as most expected it would. While the U.S. dollar index surged higher, the Euro currency slumped on the FOMC statement, as it implied divergent paths on which the Federal Reserve and European Central Bank are set to travel.

In overnight news, the German government auctioned a 10-year bund on Wednesday and it fetched a record low average yield of 0.87%. Demand was so-so but the record low yield suggests European investors are still bearish on the European Union's economic and financial conditions. Germany is the strongest EU economy and its government debt is considered the safest in the EU.

In other news, the International Monetary Fund reported that several world central banks continued to stock up on gold bullion in September. Russia, Azerbaijan and Kazakhstan all raised their gold holdings. Russia led the way by adding 1.2 million ounces last month.

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