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Gold up 11% in August: What's driving the latest rally?
Bullion was trading at around $4,530 an ounce today

Gold up 11% in August: What's driving the latest rally?

Aug 21, 2026
10:55 am

What's the story

Gold prices are set to witness their third consecutive weekly gain after the US Treasury's unexpected increase in buybacks of long-dated government debt. The move has raised concerns over its burden and is seen as a response to soaring government debt. Bullion was trading at around $4,530 an ounce and was on course to end this week more than 3% higher.

Market impact

US Treasury's surprise liquidity injection boosts bullion

The US Treasury's surprise liquidity injection earlier this week has resulted in lower yields and dollar prices, thereby boosting bullion.

On Thursday, US Secretary Scott Bessent said he was ready to expand buybacks of costlier debt.

He also indicated that the administration would soon announce a fiscal initiative to tackle the highest borrowing costs in years.

Inflation concerns

Gold's rally could be tempered by rising energy prices

Gold's rally of some 11% this month could be tempered by rising energy prices, which keep inflation risks and rate-hike bets on the table.

The yellow metal has remained above the key $4,000-an-ounce support threshold since mid-July.

This was after dip-buyers came in following a war-driven slump that pushed it into bear territory last month.

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