Investing.com — Gold prices held near a three-month high on Monday after surging more than 5% last week, as U.S. Treasury efforts to contain longer-term borrowing costs revived concerns over the dollar and the country’s fiscal position, strengthening demand for bullion as an alternative store of value.
At 21:52 ET (01:52 GMT), rose 0.5% to $4,627.69 an ounce, while gained 0.1% to $4,683.85. XAG/USD fell 0.3% to $68.79 an ounce, while XPT/USD declined 0.4% to $1,872.74. The was little changed at 98.82.
Treasury intervention revives dollar-debasement trade
Gold has extended a powerful run after gaining more than 5% last week, its third consecutive weekly advance. The metal briefly traded above $4,620 an ounce on Monday, building on Friday’s 1.9% gain and remaining close to its highest level in three months.
The latest leg higher has been closely linked to the U.S. Treasury’s surprise decision to ramp up purchases of longer-dated government debt. The move pushed bond yields and the dollar lower and has revived a trade in which investors favor hard assets such as gold when they become less confident in the long-term purchasing power of fiat currencies.
Treasury Secretary Scott Bessent subsequently indicated that the government could expand the buyback program further and said the administration would soon unveil a fiscal initiative aimed at addressing the high cost of government borrowing.
The concern is not simply about lower yields. Treasury intervention has raised questions about whether policymakers are increasingly willing to manage borrowing costs rather than allow the bond market to determine them freely.
ANZ analysts said the Treasury’s intervention has also heightened concerns about the U.S. fiscal position. They noted that gold’s move above $4,500 was supported by expectations that the government would continue trying to keep longer-term yields under control, while pressure on the dollar encouraged investors to increase exposure to bullion.
The backdrop has become more striking after U.S. government debt crossed $40 trillion for the first time, while the dollar has fallen to its lowest level in more than three months.
Gold demand strengthens as debt concerns grow
Investor appetite for bullion has broadened alongside the Treasury-driven rally. Gold-backed ETFs recorded their largest single-day inflow since September 2025 and extended their streak of net inflows to five consecutive weeks, according to ANZ analysts.
The technical picture is strengthening as well. Gold has moved above the 200-day moving average around $4,513, a level traders often watch as a sign that a longer-term trend has turned more positive. The next major technical target is around $4,700 if the momentum continues.
At the same time, geopolitical uncertainty continues to underpin demand for assets seen as stores of value.
Gold has moved well beyond the $4,000-an-ounce level that served as a key support zone during the earlier correction, while central-bank purchases and renewed ETF demand have reinforced the recovery.
ANZ said the shift in investor positioning reflects a broader move toward diversification as confidence in U.S. assets is tested by fiscal concerns, elevated debt and uncertainty over the direction of policy.
The World Gold Council has also highlighted the importance of central-bank demand as geopolitical and inflation risks remain elevated.