Forex
Home›Forex›Major Pairs›Gold tops $4,500 as the US dollar weakens and Treasury…
Gold tops $4,500 as the US dollar weakens and Treasury yields cool
Gold was around $4,520 in early Asia, helped by a weaker dollar after the US Treasury stepped up longer-dated bond buybacks to relieve pressure on bond-market borrowing costs.
Gold prices moved above $4,500 in early Asian trading on Thursday, with XAU/USD rising to around $4,520, according to FXStreet. The advance was linked to a weakening US dollar and easing pressure in US bond markets.
FXStreet said the US Treasury Department is ramping up a buyback program for longer-dated securities as it looks to rein in long-term borrowing costs, which have been at multi-year highs. TD Securities characterized the Treasury announcement as giving metals renewed support, citing expectations for improved liquidity and lower real rates, alongside a growing stagflation narrative and a Fed stance that may look through an energy shock.
FXStreet added that the latest Federal Reserve July meeting minutes showed many policymakers expected rate hikes if inflation did not decline, though the Fed held the federal funds rate in a 3.5% to 3.75% target range last month. Still, FXStreet reported that traders are largely looking past the near-term rate path due to stagflation and energy-shock concerns, pushing flows back toward gold as a safe haven.
On the technical side, FXStreet noted gold remains in a near-term uptrend, holding above the 20-period Bollinger simple moving average and the 100-day SMA. It is approaching the upper Bollinger band near $4,550, while immediate support is cited around the 100-day SMA near $4,380.
Latest closeGold $4,432.00 ▲1.6%