Gold prices moved above $4,650 per ounce on Monday, extending a strong rally as concerns over U.S. government debt and efforts to control long-term borrowing costs continued to support demand for bullion.
At 02:42 ET (06:42 GMT), XAU/USD climbed 1% to $4,650.63 an ounce, while Gold Futures rose 0.6% to $4,706.89.
Silver also moved slightly higher, with XAG/USD up 0.2% at $69.15 an ounce. Platinum gained 0.6% to $1,892.51, while the U.S. Dollar Index edged 0.1% higher to 98.88.
Gold Extends Three-Week Winning Streak
Gold has continued its powerful recovery after gaining more than 5% last week, marking its third consecutive weekly advance.
The precious metal briefly traded above $4,620 on Monday after rising 1.9% on Friday. Prices remained close to their highest level in about three months.
Investor demand has been supported by growing concerns over U.S. fiscal conditions and expectations that policymakers may continue intervening in the Treasury market.
Treasury Buybacks Revive the Debasement Trade
The latest advance in gold has been closely linked to the U.S. Treasury’s decision to increase purchases of longer-dated government bonds.
The move helped push Treasury yields and the dollar lower, encouraging investors to shift toward hard assets such as gold.
This trend is often described as the debasement trade, where investors seek protection in assets such as precious metals when confidence in the long-term purchasing power of traditional currencies declines.
Treasury Secretary Scott Bessent has also suggested that the government could expand the bond buyback program further.
He said the administration plans to introduce a fiscal initiative aimed at reducing the high cost of government borrowing.
U.S. Debt Concerns Support Gold Demand
The issue goes beyond lower Treasury yields.
Government intervention in the bond market has raised concerns that policymakers may be increasingly willing to influence long-term borrowing costs instead of allowing market forces to determine them.
ANZ analysts said these developments have increased concerns about the overall U.S. fiscal position.
They noted that gold’s rise above $4,500 was supported by expectations that authorities could continue trying to keep longer-term yields under control.
At the same time, weakness in the U.S. dollar has encouraged investors to increase their exposure to bullion.
U.S. Government Debt Tops $40 Trillion
Fiscal concerns have intensified after U.S. government debt surpassed $40 trillion for the first time.
Meanwhile, the dollar has recently fallen to its lowest level in more than three months.
This combination of rising debt and a weaker currency has increased demand for gold as investors look for alternative stores of value.
Gold ETF Inflows Strengthen
Investor appetite for gold has also increased through exchange-traded funds.
According to ANZ analysts, gold-backed ETFs recorded their largest single-day inflow since September 2025.
The funds also extended their run of net inflows to five consecutive weeks.
The rise in ETF demand suggests that institutional and retail investors are increasingly looking to gold as a hedge against fiscal and monetary uncertainty.
Gold Breaks Above Key Technical Level
The technical outlook for gold has also improved.
Prices have moved above the 200-day moving average near $4,513, a level widely watched by traders as an indicator of the longer-term market trend.
A sustained move above this area could strengthen bullish momentum.
If the rally continues, analysts and traders may focus on the $4,700 level as the next important technical target.
Geopolitical Risks Add Support
Geopolitical uncertainty is also helping support demand for gold.
Investors often turn to precious metals during periods of political instability, military conflict and economic uncertainty.
Gold has now moved well above the $4,000 level, which previously acted as an important support zone during the market’s earlier correction.
Central-bank buying and renewed ETF demand have also helped reinforce the recovery.
Central Banks Continue to Support Gold
ANZ analysts said the recent shift in investor positioning reflects a broader effort to diversify away from traditional U.S. assets.
Concerns over government debt, fiscal policy and the future direction of the dollar have made alternative stores of value increasingly attractive.
The World Gold Council has also highlighted strong central-bank demand as an important source of support for gold.
With inflation risks and geopolitical uncertainty remaining elevated, central-bank purchases could continue to provide a solid foundation for bullion prices.
Gold Outlook Remains Supported
Gold remains supported by a combination of rising U.S. debt, Treasury market intervention, ETF inflows and geopolitical uncertainty.
As long as concerns over fiscal policy and long-term borrowing costs remain elevated, investor demand for bullion could stay strong.
The next major level to watch is around $4,700 per ounce, particularly if momentum continues and the dollar remains under pressure.
