Gold Scales Fresh Highs as Treasury Buyback Plan Fuels Rally
Gold extended its rally to a four-month high, driven by the US Treasury's expanded buyback program, as investors await key inflation data and Fed guidance.
Gold prices climbed to their highest level since mid-May on Tuesday, extending a rally that began after the US Treasury announced it would double the size of liquidity support buybacks for longer-dated securities. Spot gold was up 0.6% at $4,676.75 per ounce, after touching its strongest point since May 14 earlier in the session. US gold futures rose 0.8% to $4,734.50.
Market attention now turns to the US Personal Consumption Expenditures report, due Wednesday, which is the Federal Reserve's preferred inflation gauge. Traders are also awaiting the debut speech of Fed Chair Kevin Warsh at the annual Jackson Hole conference this week. Analysts expect him to address the recent jump in bond yields and reassure markets about his independence from the Trump administration.
Citi raised its zero-to-three-month gold price target to $4,800 an ounce on Monday, saying the rally still has room to run. The bank kept its six-to-12-month target at $5,000, citing expectations of lower real interest rates, a less hawkish Fed, and an eventual easing of tensions around the Strait of Hormuz.
In other metals, spot silver gained 0.5% to $69.29 per ounce, platinum rose 0.3% to $1,880.78, and palladium firmed 0.2% to $1,359.14.
Separately, Ghana's artisanal gold marketing agency GoldBod has not paid its suppliers for up to three weeks, forcing some operators to halt purchases or borrow to stay in business, according to five industry sources.