Gold declines as Fed policy makers meet; physical demand slows

London, Jul 30. Gold today declined for the third day as investors awaited the start of a Federal Reserve policy meeting and on speculation physical demand is slowing. Gold fell by 0.4 per cent to USD 1,322.14 an ounce and silver 1.3 per cent to USD 19.61 an ounce. The Dollar Index, a measure against 10 major currencies, rose for a second day after reaching a five-week low yesterday before Fed policy makers begin a two-day meeting today. Bullion rose the past three weeks and is up 7.2 per cent this month, set for the biggest monthly gain since Jan 2012. Gold tumbled 21 per cent this year after some investors lost faith in the metal as a store of value and on speculation the Fed may curb its bond-buying programme. Fed Chairman Ben S Bernanke said it’s too early to decide whether to begin scaling back purchases in September, after saying on June 19 that buying could slow if the economy improves. Physical demand that slowed in recent weeks will probably gain as prices fall, Standard Bank said.