* Trump threatens escalation unless Iran resumes talks

* Oil back above $80/bbl, extend gains to third session

* June CPI posted first monthly decline since April 2020

* Producer Price Index due at 1230 GMT

(Updates prices as of 0443 GMT)

By Pablo Sinha

July 15 (Reuters) - Gold prices fell on Wednesday after

climbing more than 2% in the previous session, as rising oil

prices fuelled inflation concerns and uncertainty over the U.S.

interest-rate outlook, weighing on non-yielding bullion.

Spot gold was down 0.6% at $4,028.43 per ounce, as of

0443 GMT. U.S. gold futures for August delivery eased

0.8% to $4,035.50.

Gold jumped more than 2% to as much as $4,100.49 per ounce

on Tuesday, rebounding from a two-week low, after data showed

U.S. consumer inflation slowed more than expected in June as

energy prices retreated.

Oil prices extended gains to a third consecutive session as

U.S. President Donald Trump reimposed a naval blockade of all

Iranian ports and threatened to hit power plants and bridges

next week unless Tehran resumes negotiations, in the latest U.S.

escalation of the conflict.

"I reckon that the market is now looking past the CPI data,

which is kind of a lagging indication... Trump continues to

maintain the blockade of ships that is flowing out of the Strait

of Hormuz, causing oil prices to rise and gold to come under

pressure," said Kelvin Wong, a senior market analyst at OANDA.

Elevated crude oil prices can stoke concerns around

inflation and higher-for-longer interest rates, and while gold

is traditionally seen as an inflation hedge, it does lose its

appeal as a non-yielding asset in a high-interest-rate

environment.

Top Federal Reserve officialswelcomed cool inflation figures

for June, but said they would need more such readings to feel

confident that price pressures are truly easing.

The Producer Price Index, due later in the day, is expected

to offer further insight on inflation.

Traders now see about a 58% chance of a rate increase at the

Fed's September meeting, versus 76% before the report, and are

still pricing an about 80% chance of a December hike, CME

FedWatch Tool's data showed.

Elsewhere, spot silver lost 0.5% to $58.35 per ounce.

Platinum eased 0.1% to $1,629.89 and palladium

fell 0.2% to $1,302.10.