Gold turned sharply lower on Wednesday, as investors weighed US Federal Reserve Chairman Ben Bernanke's congressional testimony warning of risks to holding interest rates too low for too long and opened the possibility of reducing bond purchases. Spot gold had briefly broken above $1,400 to a one-week high of $1,414.25 an ounce after Bernanke said the Fed needed to see further signs the economy was gaining traction before removing current measures.
Spot gold was down 1.12 percent at $1,360.08 per ounce by 3:05 EDT (1905 GMT) and had fallen as low as $1,354.61. US gold futures for June delivery finished at $1,367.4, off the previous close at $1,378.20 an ounce. In after hours trade, it fell further to $1,358.70, down 1.37 percent.
As a gauge of investor interest, holdings of New York's SPDR Gold Trust, the largest gold-backed exchange-traded-fund, fell 0.8 percent on Tuesday to 1,023.08 tonnes, the lowest in more than four years. Spot silver eased 0.63 percent to $22.24 an ounce, after falling to a 2-1/2-year low earlier in the week at $20.84. Platinum trimmed gains to 0.12 percent at $1,458.74 an ounce as supply concerns in South Africa continued. Palladium was up 0.10 percent to $744.22 an ounce.