Gold rises to 3-month high amid weaker dollar

Gold on Friday was heading for a third consecutive weekly gain, reaching a more than three-month high and breaking above its 200-day moving average, helped by a weaker dollar and the U.S. Treasury Department's unexpected midweek announcement of liquidity support, UNN writes, citing Reuters.

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Spot gold rose 1.5% to $4,587.23 per ounce by 11:01 GMT (14:01 Kyiv time), after earlier reaching $4,601.29 — its highest level since May 15. U.S. gold futures rose 1.6% to $4,645.00.

Gold has risen 5% since the start of the week after its biggest one-day gain since early February on Wednesday, but ended Thursday's session lower as bond yields rose following a sell-off.

"Gold surged again after Thursday's pullback, as long-term Treasury yields rose following Bessent's interview, which failed to dispel investors' concerns about the rapid growth of U.S. government debt and fiscal sustainability," said Ole Hansen, head of commodity strategy at Saxo Bank.

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Ole added that investors' concerns about the level of U.S. government debt and the weakening dollar are the main factors affecting the market, combined with a new technical impetus aimed at buying gold above the key level of its 200-day moving average.

The metal is now trading above all of its key moving averages, with the 200-day moving average currently at around $4,513.23. Speculators trading on the basis of technical signals view a break above key moving averages as a bullish signal, the publication writes.

U.S. Treasury Secretary Scott Bessent indicated that he could further increase the volume of buybacks of U.S. Treasury securities after the department announced on Wednesday a doubling of the volume of long-term securities buybacks.

Two U.S. Federal Reserve officials expressed caution when answering questions about how changes to government debt management introduced by the Treasury Department could affect the U.S. central bank's monetary policy.

"Gold investors may have to wait for the Fed's latest signals from Jackson Hole over the course of next week before attempting to reclaim the $5,000 mark," said H. Tan, chief market analyst at Bybit.

Gold, a non-yielding asset, becomes less attractive when interest rates rise.

The recent price increase deterred retail buyers in India, while demand in China, the largest consumer, remained steady.

The spot price of silver rose 2% to $69.48 per ounce, platinum gained 2.5% to $1,873.58, and palladium rose 1.2% to $1,349.58.

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