Here's why gold has fallen below $1,200 for the first time since June

Gold has fallen to its lowest price since June at $1,200/oz. Gold fell sharply in the wake of the Federal Reserve's announcement that it will begin the process of tapering its asset purchasing programme by $10bn (£6.1bn) in January.

The decline in the price of the gold was hardly a surprise and continues the downward trajectory gold has been suffering over the course of 2013. The bad news for gold bugs is set to continue if analysts at the world's major financial institutions are to be believed. Indeed, gold bullion may well be heading for its first annual loss in 13 years after falling over 22 per cent in 2013.

Morgan Stanley has forecast a further fall in the price of gold in 2014. Morgan Stanley analyst, Joel Crane, speaking in a video report in October said:

We recommend staying away from gold at this point in the cycle.

Our forecast profile heading into next year is relatively flat against our expectations of rising real interest rates and the U.S. dollar.

In its quarterly metals report published on October 7, the corporation expected bullion to average $1,313/oz in 2014 down from the 2013 average of $1,423/oz.

Over the past several months a string of analysts and reports have been forecasting ever lower prices for the precious metal. Jeffrey Currie head of Commodities at Goldman Sachs described gold as a "slam dunk" sell. Goldman has forecast that gold may fall as low as $1,050/oz an ounce by 2014 with Credit Suisse forecasting $1,180/oz. Morgan Stanley was the latest firm to take a bearish view on gold.