Gold climbed to its highest level in nearly three months on Friday, capping a third straight weekly gain as a surprise move by the US Treasury to expand its bond buyback program eased pressure on long-dated yields and weakened the dollar.
Spot gold rose roughly 1% to around $4,563 an ounce during Friday's session, touching its strongest level since late May, according to Reuters pricing cited by The Star. Bullion finished the week up about 4.2%. Silver gained 1.8% to $69.31 an ounce, while platinum rose 2.6% to $1,875.75 and palladium added 1.7% to $1,356.59 — all three metals also on track for weekly gains.
Treasury's buyback move behind the rally
The catalyst was Wednesday's announcement that the US Treasury would double the size of its liquidity-support buybacks for bonds in the 10-to-20-year and 20-to-30-year sectors, to at least $4 billion per operation from $2 billion, effective September 9 through the next quarterly refunding in November. The move came a day after the 30-year Treasury yield touched 5.323%, its highest in roughly 19 years, amid a broader selloff tied to concerns over the national debt, which crossed $40 trillion earlier in the month.
The buyback news pushed the 30-year yield down about 7.8 basis points and the 10-year down roughly 5 basis points within hours of the announcement, and the dollar weakened against major peers — a combination that typically supports gold, which pays no yield and becomes cheaper for holders of other currencies when the dollar softens.
We've seen the dollar weakening and that has supported not just gold but all precious metals.
Brian Lan, Managing Director, GoldSilver Central
Treasury Secretary Scott Bessent signaled Wednesday that further increases to the buyback program are possible if long-end yields remain elevated, a stance traders are reading as an implicit backstop for the bond market even as the Federal Reserve keeps its own policy rate on hold.
Attention now shifts to the Jackson Hole Economic Symposium, running August 27–29, where Fed Chair Kevin Warsh is set to deliver his first keynote address since taking office in May. Futures markets were pricing roughly a two-thirds probability that the Fed holds rates steady at its next meeting, according to the CME FedWatch tool — a backdrop traders say could determine whether gold's rally has further to run or stalls out near recent highs.