US Treasury's Bond Buybacks Send Gold Soaring

Gold prices surged more than 3% on Wednesday after the US Treasury announced it would double the size of its liquidity-support buyback operations for longer-dated bonds. This move pushed Treasury yields and the dollar lower, increasing demand for gold.

The spot price of gold rose to $4,495.02 an ounce, the highest level since June 4. The 30-year Treasury yield dropped more than eight basis points to 5.20%, while the 10-year yield declined nearly five basis points to 4.660%.

Robert Gottlieb, a former head of precious metals at Koch Supply and Trading, described the move as 'very bullish for gold' due to lower yields on longer-dated Treasuries and its potential to bring the dollar lower.