(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 traded near $2,915 an ounce, as investors weighed Trump’s latest move to dial back his trade-war threat against Ontario 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.
Still, 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 were 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 $2,915.29 an ounce at 8:06 a.m. in London, after ending Tuesday almost 1% higher. The Bloomberg Dollar Spot Index was up 0.2%, following a 0.4% loss in the previous session. Platinum and palladium rose, while silver was steady.
--With assistance from Preeti Soni.
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