World gold prices continued to maintain their upward momentum in the first trading session of the week, heading towards their fourth consecutive week of increase as the weakening USD and concerns about the US fiscal burden boosted cash flow to the precious metal.
As of 9:51 am Vietnam time, spot gold prices increased by 0.18%, to 4,631.53 USD/ounce. Meanwhile, December gold futures contracts increased by 0.20%, to 4,690.01 USD/ounce.
Gold's upward momentum continued its increase of more than 5% last week, bringing the precious metal to its highest price level in about 3 months. Gold prices rose sharply after the US Treasury Department unexpectedly boosted long-term government bond repurchases.
This move dragged down bond yields and the USD, while increasing market concerns about the size of US public debt and the fiscal health of the world's largest economy.
The weakening USD continues to create momentum for gold. Precious metals are valued in greenbacks, so they often benefit when the USD depreciates, because it becomes cheaper for investors holding other currencies.
US Treasury Secretary Scott Bessent also said he is ready to expand the acquisition of high-cost debts. The US administration is also expected to announce a fiscal initiative to address high borrowing costs.
These developments are reviving the "trend of turning to gold to hedge against currency devaluation risks" (debasement trade), as investors turn to gold to hedge against the risk of currency weakening and the purchasing power of the currency being eroded in the context of rising public debt.
According to market sources, Mr. Ray Dalio - founder of Bridgewater Associates - believes that investors should reduce the proportion of bonds and can allocate up to 15% of their portfolio to gold to hedge against the US debt crisis risk.
Cash flow into gold ETFs is also improving. Previously, monitored ETFs added 18 tons of gold in the session of August 21, the strongest increase in one day since September 2025, and also aiming for the fifth consecutive week of capital attraction.
However, the strong increase in gold still faces some resistance forces. Rising energy prices may increase inflation risks, thereby causing expectations of high interest rates for a long time to return and put pressure on precious metals.
On the precious metals market, spot silver price decreased by 0.26% to 68.80 USD/ounce. Platinum price decreased by 0.09%, to 1,879.35 USD/ounce. Meanwhile, palladium price increased slightly by 0.02%, to 1,353.50 USD/ounce.
After simultaneously increasing sharply last week, the precious metal market is differentiating in the first session of the week. Gold still maintains relative strength as cash flow continues to seek risk-weighted assets in the face of instability related to the USD and US finances.
