Spot gold is trading flat today at $3,306.33 per ounce, while silver holds steady at $33.02per ounce, as investors digest the implications of the U.S. House of Representatives narrowly passing President Trump’s sweeping tax-cut and spending bill. The physical gold and silver markets remain buoyed by persistent inflation concerns, robust central bank and industrial demand, and a weakening dollar. Recent volatility in the bond market, with the 30-year Treasury yield surging above 5% and the 10-year yield hitting 4.6%, reflects mounting anxiety over the U.S. fiscal outlook and ballooning deficits. These developments have driven investors toward precious metals as alternative safe-haven assets, underpinning spot prices even as broader markets remain unsettled.
The House bill, which includes significant tax reductions and increased spending on military and border enforcement, is projected to add over $3 trillion to the national deficit in the coming decade according to the Congressional Budget Office. This has triggered a sharp selloff in long-dated Treasuries and tepid demand at recent bond auctions, sending yields to multi-year highs and putting additional pressure on the dollar. Market participants are increasingly concerned that the U.S. government’s rising debt burden and the lack of fiscal discipline could erode confidence in U.S. assets. As a result, gold and silver are likely to remain well-supported in the near term, with investors seeking to hedge against further fiscal instability and potential inflationary pressures stemming from expansive government spending.
