Gold climbs to $4,618 as dollar debasement trade lures investors

Gold spot rose 0.53% to $4,618.89 an ounce in Asian trade, extending a weekly gain of 2.23% as the debasement trade drew fresh buying.

"Gold faces limited downside because the dollar debasement trade continues to attract investor buying," ANZ said in a note.

Gold futures climbed 0.45% to $4,674.46, while silver futures advanced 1.41% to $68.99. The metal is up 13.32% over the past month and 35.98% over the past year, trading near a three-month high after US inflation data kept the Federal Reserve on a cautious path.

The US July PCE price index rose 3.7% year-over-year, well above the Fed's 2% target, keeping the focus on Fed Chair Kevin Warsh's Jackson Hole address on Aug 28. Gold's 52-week range spans $3,384.46 to $5,595.46.

Dollar, Yields Anchor the Trade

The US Dollar Index rose 0.11% to 98.95, while the 10-year Treasury yield held near 4.64%. Higher yields typically pressure gold, but the metal's resilience reflects investor demand for a hedge against currency debasement as inflation runs above target. The dollar's modest gains have not deterred bullion buyers, with gold holding above the $4,600 level through the Asian session.

The precious metals complex has been on a sustained rally, with gold up more than a third over the past year. The debasement trade — buying hard assets as a hedge against currency depreciation and fiscal expansion — has drawn institutional and retail flows alike. Silver's stronger advance reflects the same dynamic, with the gold-silver ratio compressing as industrial demand adds to the monetary bid.

On the MCX, gold futures for Oct 5, 2026 settlement declined 0.43% to Rs 1,62,115, tracking the softer global session. Retail gold in India held at Rs 16,375 per 10 grams for 24K purity in Belgaum, within the August range of Rs 14,400 to Rs 16,397. The 22K rate stood at Rs 15,010 and 18K at Rs 12,281.

What's Next

Warsh's Jackson Hole speech on Friday is the next key event. Any signal that the Fed will hold rates higher for longer could pressure gold, while a dovish tilt would reinforce the debasement narrative. Gold last traded above $4,700 on Aug 26 before pulling back, with technical indicators flagging overbought conditions. A sustained break above $4,650 would open the path toward the recent high of $4,703, while a drop below $4,600 could trigger profit-taking toward the $4,550 support zone.

This article is for informational purposes only and does not constitute investment advice.