Gold’s Rebound Fizzles as Inflation Puts Taper Timing in Focus By Bloomberg

No-Recession Predictions Begin to Look More Plausible, but Risks Remain Too High

Gold’s Rebound Fizzles as Inflation Puts Taper Timing in Focus

Published Aug 11, 2021 11:58PM ET Updated Aug 12, 2021 01:09AM ET

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Gold’s Rebound Fizzles as Inflation Puts Taper Timing in Focus

© Bloomberg. A gold bar on display in a shop window in the Gold Souk in the Deira district of Dubai, United Arab Emirates, on Wednesday, Feb. 10, 2021. While silver’s jump to an eight-year high on Feb. 1 benefited many long-standing bulls on Wall Street, shop owners thousands of miles away in Dubai’s Gold Souk were far less euphoric. Photographer: Christopher Pike/Bloomberg

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(Bloomberg) -- Gold wavered after its biggest gain in three months as moderating U.S. inflation clouded the outlook for when the Federal Reserve may start easing stimulus.

Consumer prices in the U.S. climbed at a slower pace last month than in June, according to data released on Wednesday. That triggered a move higher for gold as concerns about the Fed’s urgency to pull back on monetary stimulus softened, though prices are still lower this week after a flash crash on Monday.

Kansas City Fed President Esther George said it’s time to dial back tight monetary policy as labor markets improve. That adds to a steady drumbeat of commentary from officials that point toward the central bank readying to ease its massive bond-buying program.

The global economic recovery has piled pressure on bullion this year as investors prepare for the ultra-easy policies of the pandemic era to be reined in. Gold is also inversely tracking the dollar, with August losses for the precious metal mirrored in the greenback’s gains.

Spot gold was down 0.1% at $1,749.99 an ounce by 11:29 a.m. Shanghai time, after rising 1.3% Wednesday. Silver, platinum and palladium all fell.

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