US Fiscal Woes Boost Gold Prices to Near $4,600

Gold prices are on the rise again, and this time it's not just due to geopolitical tensions or rate expectations. According to ING strategists, the US government's own borrowing is driving gold higher.

The price of bullion has rebounded from its mid-July lows, climbing from around $4,000 a troy ounce to approximately $4,600, a level last seen in May.

ING attributes this rebound to a combination of recovering investment demand and growing market anxiety about US fiscal credibility. The prospect of the US Treasury expanding its bond-buying program has refocused investor attention on government borrowing and long-term fiscal sustainability.

The strategists say that this dynamic has also reignited concerns about currency debasement, which in turn strengthens gold's appeal as a store of value at a time when confidence in fiscal management is being questioned.