Gold Prices Soar 10% in August Amid US Treasury Bond Buybacks
Gold prices surged in August, marking its fastest monthly gain in over seven months. The precious metal rose 10% last month due to several factors, including the US Treasury's expanded long-term bond buyback operation and weakened expectations of a Federal Reserve rate hike.
The decline in rate hike expectations led to increased demand for the US dollar, which gained safe-haven status amid uncertainties. As a result, selling pressure mounted on commodities, particularly precious metals like gold and silver.
However, gold prices rebounded as the geopolitical risks eased somewhat, and investors became more optimistic about the economic outlook. The People's Bank of China (PBOC) purchased 19 metric tons of gold last month, which could be a sign of continued central bank purchases in September.