Gold rises to over 2-month high as Treasury buybacks increase
Gold rises to $4,480 per ounce, the highest since early June, as long-dated Treasury yields ease after the US Treasury said it will raise its buyback limit to $4 billion for the quarter to November.
Gold prices rose to $4,480 per ounce on Wednesday, the highest since early June, tracking the rally for long-dated Treasuries after the US Treasuries announced it would double the buyback of notes and bonds in the upcoming financial quarter.
The Treasury Department stated it would raise its buyback limit to $4 billion on the quarter to November, another effort to contain soaring yields in the long-term of the curve, following Secretary Bessent's call for higher limits on the Federal Reserve's FIMA facility.
Lower borrowing costs reduce the opportunity cost for markets to hold precious metals, which carry no coupons.
On top of that, the initial increase in dollar liquidity due to the measures also aid gold prices.
Meanwhile, the Fed is due to release minutes from the Fed's last meeting.
The resulting decision was of a rate hold, although three FOMC members dissented on the hawkish side.