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Commodities prices were dampened on Friday as investors worried the US Federal Reserve is more likely to begin tapering its stimulus plan after the release of strong economic data.

Commodity prices were dampened on Friday as investors worried the US Federal Reserve is more likely to begin tapering its stimulus plan after the release of strong economic data.

Earlier in the summer, Fed Chairman Ben Bernanke said quantitative easing will discontinue once the economy has recovered, but an early end would hurt assets like gold that have been boosted by QE for the past few years.

Other speculations that the United States is now less likely to take military action against Syria also pushed gold and other commodity prices down.

Spot gold dropped $13.92, to $1,392.06 an ounce, today, a session low, Reuters reported. Gold futures for December delivery also fell $18.80, to $1,394 an ounce. That is a shift from earlier in the week, when the precious metal hit a three-and-a-half-month high of $1,433.31. At that point, it was on track for its second consecutive monthly gain of approximately 5 percent.

Silver was similarly affected by stimulus and Syria concerns today. The metal declined to $23.39 an ounce, a drop of $0.39, according to Reuters. During the first half of the week, silver had been performing well with gold, increasing $0.22 to reach $24.50 an ounce.

Copper hit a three-week low today as the dollar gained on better-than-expected second -quarter growth. In official trading rings in London, copper for three-month delivery slid $27.79, to $7,125 a tonne. Earlier in the session, it was at $7,120, its lowest price since August 8. Worries over Fed tapering pushed copper down earlier in the week as well, but stable data from China helped keep it from tumbling too far.

Finally, Brent crude oil declined as it has become more closely correlated with gold lately, almost hitting $115 a barrel. In comparison, the commodity fared better earlier this week and hit a high of $117, Reuters reported. US crude was similarly down $0.74, to $108.04 today.

 

Related reading: 

Syria Keeps Gold Party Going, but Will it Last?

Syria Concerns Bring Silver Near $25

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Silver21.83-0.15
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