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Gold falls on swift economic recovery hopes

April 08, 2021 00:00:00

LONDON, Apr 07 (Reuters): Gold prices fell on Wednesday as robust economic data from the United States lifted expectations of a rapid recovery and dampened bullion's appeal, while investors were waiting for minutes from US Federal Reserve's last policy meeting.

Spot gold was down 0.4 per cent to $1,737.09 per ounce by 0946 GMT on the day. US gold futures slipped 0.3 per cent to $1,737.70 per ounce.

Strong US economic data is raising fears that central bank tapering can arrive sooner than expected, said ActivTrades chief analyst Carlo Alberto De Casa.

Expectations are rising that accelerating US economic growth and inflation could force the Fed to abandon its pledge to keep interest rates near zero until 2024.

Non-yielding gold is highly sensitive to rising rates, as they raise the opportunity cost of holding the bullion and support dollar and bond yields.

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