Gold prices fell on Thursday as a jump in the U.S. dollar made bullion more expensive for other currency holders after minutes from the Federal Reserve’s July meeting showed tapering of its massive stimulus is possible this year. The U.S. dollar rose to a nine-month high as global markets went into a tailspin after Fed minutes showed policymakers expected to reduce pandemic-era stimulus before the year is out.
Fed policymakers noted that the following few months’ jobs reports will be crucial, with solid gains needed to meet the U.S. central bank’s expectations and show that the coronavirus has not begun to slow the economy again. Though gold is seen as a hedge against inflation and currency debasement, the Fed’s tapering would tackle both those conditions, thereby diminishing gold’s appeal.
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