Gold Soars on US Treasury Liquidity Support Announcement

Gold surged over 3% to its highest level in more than two-and-a-half months after the US Treasury's surprise liquidity support announcement hurt bond yields and the dollar. Spot gold climbed 3.6% to $4,487.91 per ounce by 2:10 p.m. EDT, breaking above its 100-day moving average of around $4,381.

Robert Gottlieb, a former head of precious metals at Koch Supply and Trading, said the announcement was 'very bullish for gold due to lower yields on longer-dated Treasuries and as it may help to bring the dollar lower.'

The US Treasury Department's decision to double the size of liquidity support buyback operations for longer-dated bonds caused yields on 30-year U.S. Treasuries to fall sharply from around their highest level in 19 years.