Gold Hits June High, Yields Rebound as US PMI Looms
As of 2026-08-21 17:00 SGT
Key points
- The US Treasury doubled its liquidity buyback cap to at least $4 billion per operation (effective September 9 through November 4), but the initial "Bessent Bid" has worn off: the 10-year yield rebounded to 4.696% (+4.3bp).
- Gold futures jumped 1.47% to $4,638.40, a fresh high since June, as receding Fed rate-hike bets and a softer dollar fuel a "debasement trade" alongside Bitcoin's surge to $79,203 (+8.48%).
- President Trump vowed a "crushing new economic operation" against Iran and its trading partners; JD Vance called economic pressure the best route to Washington's objectives, while Tehran's foreign minister played down the threat.
- Asia closed mixed into the weekend: the Hang Seng jumped 2.02% to 26,009 while the Nikkei 225 slipped 0.30% to 66,016; Japan's headline inflation hit its highest level this year even as flash factory PMI data pointed to the strongest manufacturing growth since February.
- Europe's flash PMIs beat estimates broadly — Germany manufacturing at 54.1 vs. 52.0 expected, UK services at 52.8 vs. 51.8 expected — lifting EUR/USD to 1.1710 near three-month highs ahead of tonight's US PMI prints.
Market snapshot
| Instrument | Level | Change |
|---|---|---|
| USD/JPY | 158.51 | -0.32% |
| EUR/USD | 1.1710 | +0.25% |
| Nikkei 225 (close) | 66,016 | -0.30% |
| Hang Seng (close) | 26,009 | +2.02% |
| Dow futures | 53,040 | +0.36% |
| S&P 500 futures | 7,686.25 | +0.31% |
| Nasdaq 100 futures | 29,450 | +0.51% |
| Gold futures | 4,638.40 | +1.47% |
| WTI crude | 86.06 | -0.89% |
| Bitcoin | 79,203 | +8.48% |
| US 10-yr yield | 4.696% | +4.3bp |
Foreign exchange — Dollar softer, yen firm into the close
USD/JPY eased 0.32% to 158.51, sitting right at the bottom of the prior session's 159.13-158.51 range as hawkish BoJ bets and broad dollar softness on receding Fed rate-hike expectations kept the yen bid through the Asia close. EUR/USD advanced 0.25% to 1.1710, matching the prior session's high, as stronger-than-expected flash PMIs out of Germany and the UK reinforced the case for a steadier eurozone recovery. Look for the range to hold into the European handoff, with a decisive break of 158.51 or 1.1710 more likely to emerge in the wake of tonight's US PMI data than before it.
Equities — Futures firmer after the prior session's yield-driven selloff
Asia closed out the week with Hong Kong outperforming — the Hang Seng jumped 2.02% to 26,009 — while the Nikkei 225 eased 0.30% to 66,016 even as flash PMI data pointed to Japan's strongest factory growth since February. US index futures point to a firmer premarket open, with Dow futures up 0.36% at 53,040, S&P 500 futures up 0.31% at 7,686.25 and Nasdaq 100 futures up 0.51% at 29,450, clawing back part of the prior session's slide that was led by a roughly 9% drop in Walmart shares tied to a cautious outlook. That premarket bid still looks fragile and could unwind quickly once NY opens if tonight's PMI data reignite the Treasury-yield pressure that drove that selloff.
Macro — Bessent's buyback story dominates, US PMI on deck tonight
The Treasury's move to double its bond-buyback capacity briefly drove yields lower earlier this week, but that relief has since worn off — the 10-year yield rebounded to 4.696% (+4.3bp) as investors questioned whether debt buybacks can offset a debt pile that has now crossed $40 trillion. Treasury Secretary Bessent said there is a "very good chance" the federal budget deficit under President Trump has peaked, even as JPMorgan's Sullivan likened the bond-market intervention to "paying your mortgage with your credit card." Gold futures extended their advance to $4,638.40 (+1.47%), a fresh high since June, as traders scaled back bets on further Fed tightening and framed the move — alongside Bitcoin's 8.48% surge to $79,203 — as a dollar-debasement trade rather than a pure risk rally. In Asia, Japan's headline inflation hit its highest level this year on rising energy costs, while flash PMI data showed factories posting their strongest growth since February, a stretch that has also coincided with a reported surge in AI-linked semiconductor exports. Europe's own flash prints also beat expectations broadly across Germany and the UK, even as French activity contracted further. With Walmart's earnings warning still fresh, yields and the dollar look set to stay rangebound until New York's cash open, when tonight's flash PMI print delivers the next real directional cue.
Commodities — Gold breaks higher, oil holds a weekly gain
Gold futures rallied 1.47% to $4,638.40, decisively clearing the prior session's $4,530.00-$4,486.00 range and marking a fresh high since June as the debasement trade tied to the Treasury buyback story stayed in force. WTI crude eased 0.89% to $86.06, staying within the prior session's $89.00-$85.60 band, but remains on track for a second straight weekly gain as Washington vows to escalate economic pressure on Iran. A confirmed hold above the prior range would open the way toward the next threshold once NY commodity desks take the baton from Europe tonight.
Geopolitics — Washington turns up the pressure on Iran
President Trump vowed a "crushing new economic operation" against Iran and warned allies against continuing to trade with Tehran, while JD Vance called economic pressure "a delicate dance" but the best route to achieving US objectives. Iran's foreign minister played down Trump's economic threat, and one report cited an unnamed official saying Iran is weighing strikes on oil infrastructure timed to hurt Trump ahead of the midterms. Oil's weekly bid should stay intact through tonight's NY session, with the next headline risk more likely to surface once Tokyo returns to trade on Aug 24 than over the weekend lull.
Upcoming events
Today's calendar is light once the flash PMI wave clears — ForexLive flagged the preliminary US PMI as the session's only remaining highlight, due after New York opens tonight. Beyond that, the docket stays thin until President Trump's scheduled remarks over the weekend.
| Time (SGT) | Region | Event | Impact |
|---|---|---|---|
| 08/22 07:00 | US | President Trump Speaks | Medium |