Inflation data out, gold in the wrong direction By Investing.com

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© Reuters.

Written by Gina Lee

Investing.com – It was up in early Asian trading on Wednesday, flat before and. Both minutes and statements will be analyzed for clues to the central bank’s timetable.

It also rose 0.18% to $1,762.55 by 9:47 PM ET (1:47 AM GMT).

Inflationary pressures are lasting longer than expected, according to Atlanta Fed President Rafael Bostic, and the rally shouldn’t be called a passing thing. Meanwhile, Vice Chairman Richard Clarida said the conditions required for the Fed to begin tapering in asset purchases “have not all been met.” Claridas comments broadened expectations that the Fed will begin to scale back asset purchases as scheduled in November 2021.

The global economy fears the possibility of an inflationary recession due to the economic problems resulting from the repercussions of the Corona virus, the rise in the price of energy materials and the crisis in Europe and America, and this helped increase the purchasing concentrations on gold last week, so the strong rises in inflation data may be a starting point for gold. With global inflationary pressures mounting, markets are pricing in significant rate increases, largely betting that monetary policy will tighten sooner and at a faster rate than currently indicated. The global economic recovery from COVID-19 may be hampered by ongoing supply chain crises and inflationary pressures, according to the International Monetary Fund, as growth forecasts for the United States and other major industrial powers have fallen.

The US jobs index reached 10.44 million in August, a record number indicating a tight labor market.

As for other precious metals news, both rose 0.1%, while platinum declined 0.1%.

Update at 15:45 Riyadh time

Gold did not benefit from the negative US inflation data and the rise in the monthly core consumer price index from last month, but gold lost its gains and retreated after rising more than 1% before the data came out a few minutes ago.

It recorded 4.0%, while it was expected to remain at 4.0% levels. While it came at 0.2%, the estimate was 0.2%, but it rose from the previous month, when it recorded an increase of only 0.1%.

As for the annual total, it rose to 5.4%, and experts had expected it to reach 5.3%, and for it, it rose to 0.4%, and the estimate was to stand at 0.3%.

Gasoline price index rose 1.2% last month, the lowest reading since May, while food prices rose 0.9% during the same period, compared to an increase of 0.4% in August.

Gold is now trading at $1,759.9 an ounce, down marginally, after losing its gains, as its price before the data reached $1,775.45 an ounce, an increase of 0.87%.

As for gold contracts, it recorded 1761.80, an increase of 0.1%, after losing its gains, which amounted to an increase of 1.01%, and its price reached 1776 dollars an ounce before the release of the data.

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