Gold: Debasement narrative lifts prices – TD Securities

FXStreet Insights Team FXStreet

TD Securities’ Bart Melek notes that Gold has rallied sharply as recent U.S. Dollar weakness and concerns over Fed credibility and Treasury bond-market intervention drive fresh long positioning. Worries about America’s fiscal situation are reviving the USD debasement trade and may continue to support Gold, although a move toward TD Securities’ $5,350/oz target is still considered premature.

Fresh longs chase debasement trade

"Traders added to gold exposure as the recent U.S. Dollar weakness, Fed Credibility and Treasury Bond Intervention concerns come into focus."

"Worries about America's fiscal situation are once again resurrecting the USD debasement narrative, which, in turn, is energizing gold bugs."

"Based on Treasury Dept statements, market participants believe the government bond market interference may get even more aggressive. At this stage, gold may continue to respond to the weaker USD."

"A move to our $5,350/oz target is a little premature for now."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)

Author

FXStreet Insights Team

FXStreet

The FXStreet Insights Team is a group of journalists that handpicks selected market observations published by renowned experts. The content includes notes by commercial as well as additional insights by internal and external analysts.

AUD/USD consolidates above 0.6950 amid risk aversion

AUD/USD consolidates in the Asian session on Thursday, trading just above 0.6950 as traders assess developments in the Middle East crisis. The Pentagon reportedly ordered readiness for potential strikes against Iran. This keeps the geopolitical risk premium in play, which, along with hawkish FOMC Minutes and elevated US bond yields, will likely keep the US Dollar underpinned at the expense of the pair.

USD/JPY slips below 158.00 as USD retreats

USD/JPY returns to the red below 158.00 in the Asian session on Thursday amid speculation that authorities will step in to prop up the Japanese Yen. Meanwhile, the US Dollar eases from near an 18-month high on profit taking, ignoring Wednesday's hawkish FOMC Minutes and the risk of a further escalation of tensions in the Middle East, adding to the pair's pullback.

Gold struggles as rising yields and hawkish Fed signals weigh

Gold reverses its modest recovery on Thursday as a stronger US Dollar and rising US Treasury yields cap upside attempts, leaving the metal in a bearish consolidation phase near two-month lows. At the time of writing, XAU/USD trades around $4,119, easing from an intraday high of $4,143.

Ripple and Stellar test key support amid rising downside risks

Ripple (XRP) and Stellar (XLM) remain under pressure and extend their corrections on Thursday as weakening derivatives metrics and broader macroeconomic headwinds weigh on sentiment. XRP and XLM approach a key support zone after three consecutive days of losses so far this week.

The UK 30-year gilt just hit a 1998 high. Is that good or bad for the British Pound?

The yield on the UK's 30-year government bond, or gilt, went through 6% on October 1 for the first time since early 1998, and on Monday the Pound was at its strongest against the Euro since June 2025. The gilt market's 28-year high is mostly someone else's. Since early May, the 30-year gilt yield has risen about 0.15 of a percentage point and the US 30-year about 0.7.