Investors were eying the two-day monetary policy meet of the US Federal Reserve beginning today. The Fed is likely to taper its monthly USD 85 billion bond buying program by USD 10 billion. A tapering of QE may hurt the precious metal, which is a hedge against the inflationary risk of monetary stimulus. The withdrawal of Lawrence Summers from the race of becoming the next US Federal Reserve President opened the door for Janet Yellen who is thought to favour a smaller reduction in QE.
Goldman Sachs expects gold prices to decline heading into 2014 as a pickup in the world's biggest economy reduces the case for a ultra-accommodative monetary policy.
Gold futures for October 2013 contract, at MCX, were trading at Rs. 29,920 per 10 grams, up by 0.45 per cent after opening at Rs. 29,868, against the previous closing price of Rs 29,787. It touched an intra-day high of Rs 29,949. (At 10:43 AM).