The Fed trimmed equally both its mortgage and Treasury bond purchases, reducing the two tranches to $35 billion and $40 billion, respectively. The central bank sought to temper the long-awaited move by suggesting its key interest rate would stay lower for even longer than previously promised.
Spot gold was last up 0.5 percent to $1,235 an ounce. U.S. gold futures for February delivery settled $4.90 higher at $1,235.00 an ounce. The U.S. central bank's ultra-loose monetary policy had sent gold prices to record highs in 2011, but bullion has since lost those lofty levels as traders braced themselves for a world without massive Fed stimulus.
The Fed's asset purchase program, a centerpiece of its crisis-era response, has left it holding roughly $4 trillion of bonds. Analysts say the path to weaning the economy off the massive stimulus is rife with risk -- including the possibility of higher interest rates and shaken investor confidence.
Nine of the voting members of the FOMC supported the decision to start tapering. Only Boston Fed President Eric Rosengren dissented, noting the elevated unemployment rate and inflation below the 2-percent target.
—By CNBC with Reuters
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