Gold at five-week low

NEW YORK (Sept 15)  Gold hit five-week lows on anxiety over whether the US Federal Reserve will pare its stimulus program when it meets next week, and oil settled mixed after negotiations over Syria’s chemical weapons put investors back on edge.

In industrial metals, lead prices tumbled more than two percent to a six-week low of 2,070 a ton after inventories for the battery-making material jumped nearly 30 percent.

Gold settled lower for a second straight day, finishing its worst week in over two months as traders became risk averse ahead of the Federal Reserve’s policy-making meeting next week. Easing tensions over Syria and poor technical momentum also weighed on bullion.

Some analysts are convinced the Fed’s Federal Open Market Committee meeting next week could indicate a timeline for the central bank to pare back its monthly bond purchases of $85 billion that have been integral to higher gold prices.

The FOMC is expected to release a policy statement at the end of its two-day meeting on Wednesday.

“If the Fed defers the decision on tapering, we could well see gold take back some of the ground that has (been) lost in the last few days,” Mitsubishi analyst Jonathan Butler said.