Gold traded around $4,540 per troy ounce on Friday and was on track for a third straight weekly gain, up roughly 3.6% since Monday. The trigger came Wednesday from an unusual market player, the US Treasury itself. It announced it would at least double the size of its bond buyback operations, which sent yields on longer dated US debt tumbling. Gold jumped more than 4% to a session high of $4,524, its highest level since early June, and silver gained over 5%, breaking through the $66 mark.
A surprise move from the US Treasury
The yield on US thirty year Treasury bonds had climbed earlier this week to 5.34%, its highest level in nearly twenty years. To cool that rise, the Treasury announced Wednesday it would double the size of its bond buybacks, from $2 billion to $4 billion per operation, covering debt with maturities between ten and thirty years. The larger operations start September 9 and run through November 4, on top of an already planned total of roughly $83 billion in buybacks since early August.
This increase in buyback operation sizes reflects Treasury's desire to provide greater liquidity support in longer dated nominal sectors where there is consistent strong sponsorship from market participants.
A rate shock moves gold and silver
The announcement had an immediate effect. The thirty year yield fell from 5.34% to 5.18%, the ten year yield dropped to around 4.65%, and the US dollar hit its weakest level in three months. For gold and silver, which pay no interest of their own, that is a favorable combination. Spot gold rose 4.33% Wednesday to $4,521, spot silver rose 5.34% to $66.57. Both moves comfortably clear the threshold typically needed to call something a genuine price surge.
Silver stays in the lead on Thursday
Gold cooled to $4,516.60 on Thursday, nearly flat, while silver kept climbing to $67.96, a 1.6% gain on top of the previous day’s jump. Yields partly rebounded that day, which weighed on sentiment, but silver held its ground, helped by ongoing tension around the Strait of Hormuz. Equity markets had a rougher time, with the Nasdaq index down 1%.
Tensions with Iran keep rising
Away from the bond market, the situation around Iran kept escalating. President Trump announced on Wednesday a new, sweeping economic sanctions campaign against Iran, and the United Arab Emirates soon after suspended trade with Iran. That uncertainty is adding to demand for silver coins and physical precious metal, even though the Treasury driven rate move remained this week’s main driver.
Friday: a third straight weekly gain
Gold traded about 0.5% higher at $4,540 on Friday morning, with the dollar on track for a weekly loss. Treasury Secretary Bessent suggested the Treasury could raise the size of its buybacks further still. Worth remembering, this level is the highest since early June, but remains well below the $5,589.38 record gold hit in late January, during an earlier spike in tensions with Iran.
What this means if you are selling old gold or silver
For anyone looking to sell old gold, jewellery or coins, a jump like this is good news, but not a reason to act in a rush. The current gold price changes every day, sometimes within hours, as this week showed. The same applies to anyone looking to sell old silver, cutlery, jewellery or coins. Earlier this year a similar pattern played out when silver outpaced gold, each time for a different reason.
The weight and purity of your jewellery, cutlery or coins do not change because of a rate shock in the bond market. Only the price you get for them changes. A free, no obligation valuation shows exactly what your pieces are worth today, based on the current price.
In short
An unexpected doubling of US Treasury bond buybacks sent yields tumbling Wednesday, pushing gold up more than 4% and silver up over 5%, the strongest one day gain in months. On Thursday silver kept the upper hand while gold caught its breath, helped along by rising tension with Iran. On Friday gold is heading for a third straight weekly gain, around $4,540, its highest level since early June but still well below January’s record. For anyone selling old gold or silver, only the price at the moment of sale is the one that matters.