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FOMC Meeting Minutes Bring Gold Down, Crude Oil Higher

March 14, 2012 at 3:39 by Vladimir Vyun

Crude oil advanced after the US Federal Open Market Committee kept the main interest rate stable and improved their assessment of the US economy. The FOMC said after the monetary policy meeting:

Information received since the Federal Open Market Committee met in January suggests that the economy has been expanding moderately. Labor market conditions have improved further; the unemployment rate has declined notably in recent months but remains elevated.

Earlier, a report showed that US retail sales grew 1.1 percent last month.

Gold slumped after the FOMC decision as some investors were expecting that the Committee will add more stimulus for the economy. That could’ve boosted inflation, increasing attractiveness of the metal as an inflation-hedge. In the absence of additional quantitative easing, demand for gold waned.

April futures for delivery if crude oil traded at $106.63 per barrel in electronic trading on NYMEX, following yesterday’s advance by $0.37 to $106.71 per barrel. Brent rose from $125.63 to $126.23 per barrel on the previous trading session and traded at about $125.99 as of 3:34 GMT today on ICE. Gold traded at $1,677.20 per ounce on COMEX at today’s session after falling from $1,700.10 to $1,675.90 yesterday.

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