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Gold edges higher after Trump's bill boosts bond market uncertainty
Friday, 23 May 2025 16:42 WIB | GOLD |GOLD

Gold (XAU/USD) price extends its weekly gains, trading near $3,330 at the time of writing on Friday, up nearly 1% on the day, on a new tailwind for the safe haven precious metal.

The spending bill from United States (US) President Donald Trump passed through the House of Representatives on Thursday and is now on its way to the Senate.

Traders are worried that the spending bill will only add more US debt, while income from tariffs remains to be seen as enough to provide funding for all the spending.

The best place to track these concerns is the US 30-year benchmark rate. Yields in that maturity rallied to 5.15% on Thursday from 4.64% at the start of May, a more than one-year high since the 5.18% seen at the end of December 2023. Adding all things up, the recent downgrade on US credit rating from agency Moody's, and now this spending bill, which adds $3.8 billion to the US debt, traders and market participants demand a higher premium or return before considering buying US debt bonds, which pushes US yields higher, the Economic Times reports.

Source: FXStreet

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