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Fed Makes Gold Drop & Copper Rally, Wheat Declines

March 20, 2014 at 7:04 by Vladimir Vyun

As was expected, the Federal Reserve trimmed its monthly purchases at the same rate as at the previous meeting — $10 billion. Gold sank, while copper rallied as a result. The Fed also suggested that interest rates may reach 1 percent by the end of 2015. All in all, the central bank’s statement was considered to be more hawkish than had been expected. Gold declined $9.0 (0.67 percent) to $1,332.3 per troy ounce as of 6:48 GMT on COMEX today. May contract for delivery of copper advanced $0.014 (0.47 percent) to $2.9655 per pound.

Wheat retreated today on speculations that prices, which were heading to the biggest monthly gain in more than three years, are too high and will hurt demand. Previously, the grain was rallying on the forecast that adverse weather will reduce output from the United States. Yet now analysts said that all weather concerns are already priced in and prices should consolidate in a near term. May wheat slipped $.0425 (0.59 percent) to $7.1150 per pound on CBoT.

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