Thu Jun 21, 2012 1:22am IST

* Gold briefly down 1.5 pct on no new outright bong
purchases
    * Disappointment even though "Operation Twist" extended
    * Bullion market had anticipated more Fed actions to boost
growth
    * Coming up: U.S. jobless claims Thursday


    By Frank Tang
    NEW YORK, June 20 (Reuters) - Gold fell around 0.5 percent
in choppy trade o n W ednesday as investors sold the precious
metal after the Federal Reserve ended a policy meeting without
launching a third round of quantitative easing to stimulate the
U.S. economy.

    Gold briefly fell 1.5 percent after the Fed did not announce
a third round of outright bond purchases known as quantitative
easing (QE3). Investors had been betting that QE3 would boost
demand for gold as a hedge against economic uncertainty and
currency depreciation risks.
  

  Instead, the statement concluding a two-day policy meeting
said the Fed is extending its effort to depress borrowing costs
by selling short-term bonds and buy longer-dated ones -- known
as "Operation Twist" -- by $267 billion through the end of the
year. 
    

Bullion recovered some losses as the market turned its focus
on the Fed's downgraded forecasts for U.S. growth, saying it was
prepared to take further steps to help the economy if needed.
    "At least for the near term, it's mainly a short-term
negative for gold because it indicates that there won't be
immediate and new aggressive accommodation, and certainly no QE3
at all judging from this statement," said Bill O'Neill, partner
of commodities wealth manager LOGIC Advisors in New Jersey.
    

Spot gold was down 0.5 percent at $1,608.09 an ounce
by 2:45 p.m. EDT (1845 GMT), having earlier traded as low as
$1,590.29.
    U.S. gold futures for August delivery settled down
$7.40 an ounce at $1,615.80, with trading volume in line with
its 30-day average, preliminary Reuters data showed, easily the
highest turnover in the last two weeks. 
    Recent poor indicators from the U.S. jobs, manufacturing and
retail sales sector prompted talk the Fed could be pushed into a
new round of asset buybacks, fueling gold's seven-day rally
which ended earlier this week. 
    

Fed Chairman Ben Bernanke did not specify details of the
central bank's plans at a news conference following the policy
statement.
    "The market was really hoping for a very dovish, QE3 type
event, and it didn't get it. You are not going to see a rally in
gold right now," said Jeffrey Sherman, commodities portfolio
manager of Los Angeles-based asset manager DoubleLine Capital
which oversees $37 billion in assets.
   

 Minutes from meetings of the Bank of Japan and Bank of
England released on Wednesday suggest officials are poised to
ease policy again. China cut benchmark rates on June 7, while
the European Central Bank could take action at its July 5
meeting. 
    
    

FED STIMULUS SPECULATION
    Gold had rallied after the Fed in January pledged to keep
interest rates near zero until at least late 2014. Gold has
since tumbled several times, however, after Bernanke mentioned
no further easing in his congressional testimonies.
    Year-to-date, gold is up about around 3 percent. The market
is still a long way off the record high of $1,920.30 an ounce
hit last year.
    
     
 
    
    Safe-haven bids due to the European debt crisis also
underpinned gold. Spain on Tuesday had to pay a euro-era record
price to sell short-term debt, underlying that the region's
troubles run much deeper than Greece.
    Among other precious metals, silver was down 0.9
percent at $28.12 an ounce. Platinum fell 0.9 percent to
$1,460.25 an ounce, while palladium dropped 0.8 percent
to $619.25.      
 2:45 PM EDT     LAST/    NET   PCT      LOW    HIGH  CURRENT
                SETTLE   CHNG  CHNG                       VOL
 US Gold AUG   1615.80  -7.40  -0.5  1590.50 1623.60  192,015
 US Silver JUL  28.389  0.021   0.1   27.630  28.595   57,412
 US Plat JUL   1466.80 -13.70  -0.9  1454.60 1487.40   11,726
 US Pall SEP    619.50  -9.90  -1.6   614.70  632.00    3,517
                                                              
 

Gold          1608.09  -8.51  -0.5  1592.10 1622.40         
 Silver         28.120 -0.260  -0.9   27.790  28.610
 Platinum      1460.25 -12.60  -0.9  1459.05 1484.25
 Palladium      619.25  -4.88  -0.8   616.73  629.25
                                                              
 TOTAL MARKET              VOLUME          30-D ATM VOLATILITY
                CURRENT   30D AVG  250D AVG   CURRENT     CHG
 US Gold        198,263   215,937   197,089     21.76    0.16
 US Silver       72,561    50,517    53,001     29.85   -0.22
 US Platinum     14,843     9,387     8,107     23.77   -0.04
 US Palladium     3,551     5,746     4,486