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TANGIBLE INVESTMENTS - Los Angeles - by James O'Dell - The price of Gold retreated sharply on Wednesday as the precious metal eased to $1,330.66 an ounce, while silver slipped to $20.65 an ounce, following the Federal Open Market Committee (FOMC) meeting which ended just a short while ago. "Gold's appeal as an inflation hedge is not as strong after the Fed's moves. It was already down on the reduction in geopolitical risk, so the combination of the two is pretty powerful," says James Steel, of HSBC.
 
In the first FOMC meeting led by Janet Yellen after taking the helm as Fed Chair on Feb. 1, the central bank ended its practice of using the U.S.  unemployment rate as a threshold for gauging the strength of the economy.  That also ended the central bank's promise to hold rates steady "well past the time" the U.S. unemployment rate drops below 6.5 percent.
 
"The committee currently anticipates that, even after employment and inflation are near mandate-consistent levels, economic conditions may, for some time, warrant keeping the target federal funds rate below levels the committee views as normal in the longer run," said the Fed at the conclusion of the two day meeting. The central bank also announced that it will trim its massive quantitative easing (QE) program by another $10 billion, dropping monthly purchases from $65 billion to $55 billion.
 
Meanwhile, Peter Schiff, of Euro Pacific Capital says "The real reason gold is going up is because of inflation."  Schiff believes that the official 1.6 percent increase in consumer prices through January fails to state the true rate of inflation. He also thinks the Fed will not continue to taper QE. "The Fed has no way out of QE [quantitative easing]; the U.S. economy is slipping back into recession," says Schiff. "The Fed is going to ramp up QE, not continue to taper. All of that is very bullish for gold."
 
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