Gold hovers at three-month high on dollar weakness, Treasury buyback
Gold prices are hovering near three-month highs due to a weakening U.S. dollar and Treasury bond buyback plans. Investors are currently awaiting comments from Fed Chair Warsh at the Jackson Hole Symposium for clues on future interest rate policy.
Why it matters
Gold's performance serves as a key indicator of market sentiment regarding U.S. debt sustainability and central bank monetary policy.
Gold prices fell on Tuesday morning, but hovered around their highest level in more than three months, supported by a weaker U.S. dollar and as the U.S. Treasury's bond buyback plans.
Spot gold fell 0.4% to $4,634.35 per ounce, still near its highest since mid-May with UOB forecasting the metal is on track "for its strongest monthly gain since September 1999." The yellow metal has gained more than 15% so far this month.
Gold futures were down by 0.1% at $4,691.70, also close to a three-month high.
Gold A softer dollar makes greenback-priced gold attractive to holders of foreign currencies, while lower Treasury yields reduce the opportunity cost of buying bullion.
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