Gold Rises as Weak Bond Auction Highlights U.S. Fiscal Concerns
Gold rose for a fourth day, as investors rejected U.S. President Donald Trump’s tax cut plans and a widening fiscal deficit, pushing long-term U.S. Treasury yields near their highest in two decades.
Gold rose as much as 0.9% to around $3,345 an ounce. Appetite for safe-haven assets has increased amid risk-off sentiment toward stocks, which has also fueled a decline in the U.S. dollar.
The precious metal, which hit an all-time high last month and has gained more than a quarter this year, is up nearly 4% so far this week. The renewed support for bullion after its biggest weekly drop since November suggests investors are shifting focus from the immediate impact of tariffs to longer-term structural concerns about the U.S. economy. On Wednesday, a lackluster auction of $16 billion in 20-year Treasuries highlighted concerns that Trump’s tax cuts will add trillions of dollars to already ballooning budget deficits at a time when appetite for U.S. assets is waning around the world.
That prompted investors to seek refuge in gold and other traditional safe havens, such as the yen and Swiss franc. Meanwhile, a weaker U.S. dollar also supported the precious metal by making it more affordable for investors using other currencies.
Gold rose 0.7% to $3,339.65 an ounce as of 11:45 a.m. in Singapore. The Bloomberg Dollar Spot Index fell 0.1%. Silver rose, while platinum and palladium were flat.
Source: Bloomberg
