Gold Holds Near Three-Month High as Treasury Efforts Revive Dollar-Debasement Trade

Gold prices held near a three-month high on Monday after surging more than 5% last week, as U.S. Treasury efforts to contain longer-term borrowing costs revived concerns over the dollar and the country's fiscal position.

The price of gold rose 0.5% to $4,627.69 an ounce, while Gold Futures gained 0.1% to $4,683.85. In contrast, XAG/USD fell 0.3% to $68.79 an ounce, and XPT/USD declined 0.4% to $1,872.74.

The Treasury's surprise decision to ramp up purchases of longer-dated government debt has pushed bond yields and the dollar lower, reviving a trade in which investors favor hard assets like gold when they become less confident in the long-term purchasing power of fiat currencies.

Treasury Secretary Scott Bessent indicated that the government could expand the buyback program further and said the administration would soon unveil a fiscal initiative aimed at addressing the high cost of government borrowing.