Gold climbs to over 2-month high as Treasuries rally
Gold rises to $4,480 per ounce on Wednesday, its highest since early June, as long-dated US Treasuries rally following a doubling of Treasury note and bond buybacks in the upcoming quarter.
Gold prices rose to $4,480 per ounce on Wednesday, the highest since early June, tracking the rally for long-dated US Treasuries after the Treasury Department doubled the buyback of notes and bonds in the upcoming financial quarter.
It marked another effort by Washington to contain soaring yields in the longer portion 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, minutes of the Federal Reserve's rate-setting meeting confirmed that a portion of policymakers argued that raising rates this year could prevent sharper inflationary pressure later on.