Gold falls as US stimulus lifts dollar

Gold lost as much as 2.5% this morning as investors fled to the dollar following the Fed's latest stimulus measures.

The US central bank has opted against further QE in favour of a debt swap which will see it sell short-term bonds for longer dated treasuries. Analysts said the move has left many traders who had been hoping for more QE disappointed, sending shares plunging. It has also sparked a fall in the gold price, according to managers, with investors piling into the dollar in reaction to the stimulus plans. "Investors have been let down by Bernanke's move, while the dollar has rallied on the prospect there is not going to be any strong monetary boost," Ian Williams, chief executive at Charte...