Gold fell 1 percent on Thursday after the minutes of the Federal Reserve's most recent meeting gave no indication that U.S. policymakers were gearing up for additional action to stimulate growth, lessening the chances of a boost for the bullion price. Wednesday's minutes showed the Fed was open to buying more Treasury bonds to stimulate the economy but that the recovery might need to weaken for a consensus to build.

Disappointment that the minutes did not point to greater appetite for QE, coupled with data showing the number of Americans filing new claims for unemployment benefits fell to the lowest in four years, lifted the dollar to two-year highs against the euro.  The correlation between gold and the dollar index was around its most negative in two years.

The gold price has more than doubled in value since the Fed initiated its multi-trillion dollar bond-buying program, a tool known as quantitative easing, in late 2008 during the depths of the global financial crisis. The market can pretend that QE3 isn't important, but it is one of the fundamental factors that is supporting gold prices.

Gold has fallen in six out of the last 10 trading sessions, compared with seven daily declines in global equities.

August gold futures on the COMEX today declined by 10.9 and now stands at $ 1564.8 USD per ounce.