Gold Extends Gains as U.S. Debt Worries and Geopolitical Tensions Support Safe-Haven Demand

Gold prices climbed further in Asian trading on Thursday, continuing a strong upward trend fueled by rising demand for safe-haven assets amid deepening concerns over the United States’ fiscal outlook and lingering geopolitical tensions in the Middle East.

Spot gold rose 0.7% to $3,338.04 an ounce, while June gold futures gained 0.8% to $3,339.20, as of 01:27 ET (05:27 GMT).

Safe-Haven Demand Rises on U.S. Debt and Tax Bill

The metal’s strength this week has been underpinned by investor anxiety over ballooning U.S. government debt, especially following Moody’s downgrade of the U.S. credit rating. That move has rattled markets and prompted a rotation out of U.S. Treasuries and the dollar into gold, pushing Treasury yields higher and weighing on greenback sentiment.

The House of Representatives is also preparing for a crucial floor vote on President Donald Trump’s tax-cut and spending bill, which proposes to extend the 2017 tax cuts while adding further outlays for border and defense spending. Analysts warn the legislation could further inflate the $36 trillion U.S. debt pile, intensifying fiscal risks.

This backdrop of rising debt, volatile bond markets, and policy uncertainty has pushed gold higher, reaffirming its role as a hedge against systemic risks.

Middle East Tensions Add Fuel

Gold was also supported by geopolitical risk, after reports earlier this week indicated Israel was preparing for a potential strike on Iran’s nuclear facilities. Although news of renewed nuclear negotiations between Tehran and Washington has calmed fears of an immediate escalation, Israel’s military posture remains unchanged, with officials stating they are “ready to act” if diplomacy fails.

This ongoing uncertainty in the Middle East continues to keep safe-haven demand elevated, supporting both gold and other precious metals.

• Platinum futures rose 0.4% to $1,082.20/oz
• Silver futures climbed 0.7% to $33.873/oz

Copper Rises on China Stimulus Hopes

In the industrial metals space, copper prices advanced Thursday, supported by a weaker dollar and fresh optimism over economic stimulus from China, the world’s top consumer of the red metal.

• Benchmark copper futures on the London Metal Exchange rose 0.2% to $9,545.50 a ton
• U.S. copper futures surged 1.3% to $4.7175 a pound

Earlier this week, China’s central bank cut its benchmark loan prime rate, signaling a shift toward looser monetary policy. The move is seen as a precursor to broader stimulus measures aimed at propping up domestic demand and reviving manufacturing activity—both crucial for copper demand.

Trade relations between the U.S. and China remain fragile, but market participants are cautiously optimistic that recent tariff pauses could lead to broader economic cooperation, lending further support to metals.