(Bloomberg) — Gold steadied, underpinned by haven demand after Wall Street was whipsawed by President Donald Trump’s on-off tariff plans and his latest comments downplaying fears of a recession.
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Bullion, which fluctuated around $2,900 an ounce over the previous week, traded near $2,915 on Wednesday as investors weighed Trump’s latest move to dial back his trade-war threat against Canada just hours after saying he would double duties on Canadian steel and aluminum to 50%. The president also downplayed the risk of a tariff-led recession.
A slew of tepid economic reports in the US have sparked fears of stagflation, where there’s upside risk for inflation as well as downside risk for economic growth. A trade-induced growth slowdown could lead the Federal Reserve to cut interest rates multiple times this year.
Traders will assess an inflation reading later Wednesday that may show US consumer prices rose in February. That could complicate the Fed’s rate-cut agenda, with easing monetary policy generally positive for non-interest bearing bullion.
Elsewhere, markets are monitoring a potential easing in geopolitical risks that could ease haven demand. Ukraine accepted a US proposal for a 30-day truce with Russia as part of a deal with the Trump administration to lift its freeze on military aid and intelligence for Kyiv.
Spot gold was little changed at $2,915.57 an ounce at 10:04 a.m. in London, after ending Tuesday almost 1% higher. The Bloomberg Dollar Spot Index was up 0.2%. Silver, platinum and palladium rose.
–With assistance from Preeti Soni and Jack Ryan.
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