Gold futures dropped beneath the milestone price of $1,600 per troy ounce on Thursday, one day after the policy-making arm of the U.S. Federal Reserve opted to lengthen a monetary stimulus program, Reuters reports.
Operation Twist, which the Federal Open Market Committee said will push beyond this month on Wednesday after two days of meetings, represents somewhat of a disappointment for investors and traders who were counting on a third round of quantitative easing.
"The failure of the FOMC to announce another round of quantitative easing was a mild disappointment for the bullion markets," analyst James Steel with HSBC Securities told MarketWatch. "Following the announcement, the gold market may shift the focus back to the euro zone, we believe."
At 11:39 a.m. on Thursday, gold futures fell 2.7 percent, a $43.60 loss to $1,572.20 per troy ounce.
The yellowish metal also pulled down silver and copper futures, according to MarketWatch. But, by contrast, the U.S. dollar strengthened as indicated by the dollar index. The metric that gauges the value of the world's reserve currency against six competing currencies increased from Wednesday to Thursday.