Gold price rebounds on signs of peaking US inflation

Gold prices rebounded on Wednesday after the latest US inflation data showed consumer prices rose at a slower pace last month, easing fears that the Federal Reserve may taper its economic support sooner than expected.

Spot gold rose 1.2% to $1,749.62 per ounce by 11:45 EDT, recovering some ground after four straight sessions of declines. US gold futures gained 1.1%, trading at $1,751.30 per ounce in New York.

Earlier, the Labor Department stated that the US consumer price index rose 0.5% in July, after a 0.9% rise in June. This was the largest month-to-month drop in 15 months, a tentative sign that inflation may have peaked as supply chain disruptions work their way through the economy.

Additionally, core CPI, which excludes the volatile food and energy components, rose 0.3% last month after increasing 0.9% in June, which was weaker than expected.