Treasury Buyback Plan Sparks Gold and Bitcoin Rally

The US Treasury's recent announcement to increase buybacks of longer-dated Treasury securities has sent shockwaves through financial markets. The decision to double the maximum buyback size from $2 billion to at least $4 billion per operation, effective September 9 through November 4, has led to a significant impact on gold and bitcoin prices.

Following this announcement, 30-year Treasury yields fell sharply, while both gold and bitcoin saw price increases. The US dollar weakened, which is often associated with rising commodity prices.

The reaction in the prediction markets was evident, with pricing suggesting a shift in expectations regarding gold's potential to hit higher price points by the end of 2026. Scenarios where gold prices reach $15,000 by December 2026 have seen slight adjustments in implied probabilities, though still indicating a low likelihood.