Fiscal Fears Fuel Gold's Strong Rebound

Gold prices have rebounded sharply from their July lows, supported by renewed investment demand and growing unease over the US fiscal outlook. The precious metal climbed to around $4,600/oz, returning to levels last seen in May.

The latest move followed the US Treasury's decision to increase its purchases of longer-dated government debt. The maximum size of buyback operations in the 10-to-30-year segment will rise from $2bn to at least $4bn, with Treasury Secretary Scott Bessent signalling that the programme could be expanded further.

The bond-market impact proved short-lived, with long-term yields subsequently recovering much of their decline. Gold, however, continued to strengthen, suggesting that its resilience is not simply a response to lower yields.