Gold prices climbed to $4,480 per ounce on Wednesday, their highest level since early June, following a rally in long-dated US Treasuries after the Treasury Department announced it would double buybacks of notes and bonds in the upcoming fiscal quarter. The move represents another effort by Washington to rein in elevated yields at the long end of the curve, coming on the heels of Secretary Bessent’s call for higher limits on the Federal Reserve’s FIMA facility.
Lower borrowing costs reduce the opportunity cost of holding non-yielding assets such as gold, lending support to prices. In addition, the initial boost to dollar liquidity stemming from these measures has further underpinned the metal.
Meanwhile, minutes from the Federal Reserve’s latest policy meeting showed that some officials argued for raising interest rates later this year to head off the risk of more intense inflationary pressures down the line.
