“The global recovery and rising vaccinations will boost risk appetite and keep it at a relatively high level,” said Cao Xiaojun, an analyst at Hua An Futures. “Gold and silver will probably resume a weak course and we recommend being bearish.”

Gold futures were little changed – at a four-month high of US$1,867.70 per ounce – in New York on Wednesday, as traders awaited the minutes from the Fed’s April meeting for signs on whether the world’s biggest central bank will taper bond purchases earlier than expected. Gold’s performance also trailed an 11 per cent jump in the Bloomberg Commodity Index this quarter, which has been buoyed by industrial metals amid a supply squeeze.

Gold has won favour among investors again this quarter, as looming inflation boosts its allure as a hedge against rising prices and the Fed plays down the implication of inflation by saying that the increase is transitory. Consumer prices in the US rose at their fastest pace since 2009 in April, while China’s factory gate inflation accelerated at its quickest pace in more than three years.

“For gold, it’s still [the case] that opportunities outstrip risks, as long as the Fed keeps dovish, the US hasn’t been fully vaccinated and the jobs market doesn’t improve by adding millions of jobs on a constant basis,” said Wei Wei, an analyst at Ping An Securities. “But expectations shouldn’t be high for a further rebound in gold prices against the backdrop of global recovery.”