Gold hits three-month high amid dollar weakness bond market selloff
Gold has rallied to a three-month high – and like bitcoin (see earlier post) it is partly down to a fall in the value of the US dollar and a selloff in bond markets.
The safe haven asset had climbed 1.31% this afternoon to $4,575, having reached $4,601 earlier in the day – its highest since 15 May.
It comes after government borrowing costs around the world surged to the highest levels in decades amid growing fears over US bond market turmoil.
Anxiety about Donald Trump’s handling of the economy, and concern that his war with Iran is driving up inflation, have sparked a sell-off in the US bond market.
US Treasury Secretary Scott Bessent signalled on Thursday that he could ramp up government bond buybacks even further.
That came after the department announced on Wednesday it would double the size of its buybacks on longer-dated securities, sending the 30-year yield sharply lower.
The US dollar’s slide boosted the precious metal further. The dollar was 0.01% down against the pound at 73.3p and 0.04% down against the euro at 85.5 cents on Friday afternoon.
For anyone who missed the drama in the US bond market earlier this week – or who is simply scratching their head about what it means – here’s a handy explainer:
Ole Hansen, head of commodity strategy at Saxo Bank, wrote:
Gold surged again after a setback on Thursday as long-end Treasury yields climbed following a Bessent interview that failed to quell investor concerns about spiralling U.S. debt and fiscal sustainability.”
Key events
Closing summary
Time to wrap up…
The UK economy was described as being on a “firmer footing” after positive service sector growth and rising consumer confidence, according to a series of polls.
S&P Global’s flash poll of purchasing managers showed the services sector reaching a six-month high of 52.8 in August, up from 52.1 in July, with companies citing improving domestic trading.
Jake Finney, a senior economist at PwC, said it provides “increasingly encouraging signs that the economy is finding firmer footing”.
Meanwhile, consumer confidence hit a two-year high in August, according to a survey released overnight.
However it was not all good news, as retail sales weakened last month despite the football World Cu and record temperatures boosting food and drink demand.
The UK government ran a larger-than-expected £1.8bn deficit in July – another data release underlining the challenges facing the chancellor, John Healey, as he draws up his first budget.
In the first four months of this financial year the cumulative deficit was £56.7bn – lower than last year but still £2.3bn ahead of the figure forecast by the Office for Budget Responsibility.
Healey will deliver his budget on 28 October.
Airbus has bowed to employee demands on remote working, after a series of strikes over its chief executive’s return-to-the office orders.
The world’s largest aeroplane maker is said to have watered down plans to restrict remote working to one day a week from September. At present, staff are able to work remotely for two.
It was part of a high-profile campaign by the Airbus chief executive, Guillaume Faury, to get staff back into the office, in an effort to ensure the company could meet record demand and prepare new products after hiring thousands more staff.
Gold has rallied to a three-month high – and like bitcoin (see earlier post) it is partly down to a fall in the value of the US dollar and a selloff in bond markets.
The safe haven asset had climbed 1.31% this afternoon to $4,575, having reached $4,601 earlier in the day – its highest since 15 May.
It comes after government borrowing costs around the world surged to the highest levels in decades amid growing fears over US bond market turmoil.
Jamie and Jools Oliver paid themselves a £1.5m dividend – more than 40% down on last year – after profits at their cookery and media empire almost halved.
Sales at Jamie Oliver Holdings remained broadly steady at £28.4m in 2025, £160,000 less than in the previous year, as a strong performance at the group’s restaurants, franchise business, cookery schools and TV productions offset a decline in royalties, licensing and endorsements.
“We have delivered new Jamie Oliver titles in both book and TV formats during the year and there has been a continued strong performance from back catalogue book titles and our international television content distribution,” accounts filed at Companies House said.
A “hyperscale” datacentre in outer London would generate more than 1m tonnes of carbon dioxide a year, equivalent to the carbon footprint of 27,000 flights from London to New York, planning documents show.
The East Havering Data Centre Campus (EHDCC) in North Ockendon would be one of the largest datacentres in Europe if approved by Havering council, using 218 hectares of green belt to run servers and data storage systems for AI and cloud computing.
Its developer, Digital Reef, has described the scheme as “a unique opportunity to create a sustainable datacentre campus of the future”.
Guardian analysis of planning documents for the dozens of proposed datacentres in the UK shows that the EHDCC has the highest projected carbon emissions disclosed by a developer.
US private sector output hits four-year high, says PMI survey
Business growth in the US private sector has hit a more than four-year high in August, fueled by a surge in service sector activity and rising optimism, according to a new snap survey.
Not to be outdone by a similarly resurgent poll for the UK (see earlier post), a survey of purchasing managers at US firms registered its strongest reading for business output since April 2022.
S&P Global said its flash PMI Index, which measures private sector growth, rose to 56, the highest score sice April 2022 and up from 54.5 last month.
It was largely driven by the services sector, which had a reading of 56.8, the highest since December 2024, and more than offsetting a five-month low in the manufacturing sector of 53.2.
Chris Williamson, chief business economist at S&P Global Market Intelligence, said:
US business is booming, with firms reporting the fastest output growth for over four years so far in the third quarter as the expansion picked up further momentum in August.
Jobs growth has also shown a welcome revival in August, with employers gaining in confidence as concerns fade over the negative economic impacts of tariffs and the conflict in the Middle East.
However, the latter in particular remains a key area of concern for businesses, especially via the impact on supply lines and energy prices.”
Sarah Butler
Jamie and Jools Oliver have paid themselves a £1.5m dividend – more than 40% down on last year – after profits at their cookery and media empire almost halved.
Sales at Jamie Oliver Holdings remained broadly steady at £28.4m in 2025, £160,000 less than in the previous year, as a strong performance at the group’s restaurants, franchise business, cookery schools and TV productions offset a decline in royalties, licensing and endorsements.
Accounts filed at Companies House said:
We have delivered new Jamie Oliver titles in both book and TV formats during the year and there has been a continued strong performance from back catalogue book titles and our international television content distribution.”
The Eat Yourself Healthy cookbook was a No 1 global bestseller, selling nearly 70,000 copies in its first week, making it one of Jamie’s fastest-selling books.
However, pre-tax profits at the group, which became a certified B Corp in 2019, slumped to £1.25m, from £2.4m a year before, after £1.46m of exceptional costs related to a business restructure in which about 20 jobs were lost from the Olivers’ media team.
Profits were also affected by pre-opening costs on a new cookery school in John Lewis’s Oxford Street outlet in London.
Airbus bows to remote working demands after series of strikes
Kalyeena Makortoff
Airbus has reportedly bowed to employee demands on remote working, after a series of strikes over its chief executive’s return-to-the office orders.
The world’s largest aeroplane maker is said to have watered down plans to restrict remote working to one day a week from September. At present, staff are able to work remotely for two.
It was part of a high-profile campaign by Airbus’s chief executive, Guillaume Faury, to get staff back into the office, in an effort to ensure the company could meet record demand and prepare new products after hiring thousands of new staff.
Faury told employees in June that while home working had been a lifeline during the Covid pandemic, the opposite was now true as Airbus needed them to share their skills in person. “I count on all of you to support this,” he said in a memo, reported by Bloomberg.
But disruption caused by a series of strikes, including in Spain, France and the UK in recent months, has forced him to backtrack, according to Reuters. Managers have now been told staff can work at home an average of two days a week, in effect curbing the chief executive’s efforts.
Excl: Proposed datacentre will have annual carbon footprint of 27,000 flights to New York
Matthew Pearce
A “hyperscale” datacentre in outer London would generate more than 1m tonnes of carbon dioxide a year, equivalent to the carbon footprint of 27,000 flights from London to New York, planning documents show.
The East Havering Data Centre Campus (EHDCC) in North Ockendon would be one of the largest datacentres in Europe if approved by Havering council, using 218 hectares of green belt to run servers and data storage systems for AI and cloud computing.
Its developer, Digital Reef, has described the scheme as “a unique opportunity to create a sustainable datacentre campus of the future”.
Guardian analysis of planning documents for the dozens of proposed datacentres in the UK shows that the EHDCC has the highest projected carbon emissions disclosed by a developer.
Donald Campbell, advocacy director at the tech justice nonprofit Foxglove, said the EHDCC’s projected emissions were “staggering”.
More below…
Readers with long memories may recall the last time this was happening to gold and bitcoin.
About 10 months ago, investors were piling into assets such as gold, bitcoin and shares amid worries about government debt, central bank independence, and the weakness of major currencies such as the dollar.
On that occasion it even got a nickname: the “debasement trade”.
But for those of you who haven’t been paying attention, here’s our explainer on exactly what that trade was, why it happened and how it relates back to one Henry VIII…
Gold hits three-month high amid dollar weakness bond market selloff
Gold has rallied to a three-month high – and like bitcoin (see earlier post) it is partly down to a fall in the value of the US dollar and a selloff in bond markets.
The safe haven asset had climbed 1.31% this afternoon to $4,575, having reached $4,601 earlier in the day – its highest since 15 May.
It comes after government borrowing costs around the world surged to the highest levels in decades amid growing fears over US bond market turmoil.
Anxiety about Donald Trump’s handling of the economy, and concern that his war with Iran is driving up inflation, have sparked a sell-off in the US bond market.
US Treasury Secretary Scott Bessent signalled on Thursday that he could ramp up government bond buybacks even further.
That came after the department announced on Wednesday it would double the size of its buybacks on longer-dated securities, sending the 30-year yield sharply lower.
The US dollar’s slide boosted the precious metal further. The dollar was 0.01% down against the pound at 73.3p and 0.04% down against the euro at 85.5 cents on Friday afternoon.
For anyone who missed the drama in the US bond market earlier this week – or who is simply scratching their head about what it means – here’s a handy explainer:
Ole Hansen, head of commodity strategy at Saxo Bank, wrote:
Gold surged again after a setback on Thursday as long-end Treasury yields climbed following a Bessent interview that failed to quell investor concerns about spiralling U.S. debt and fiscal sustainability.”
War, wildfire and cyber-attack anxiety leads to growing EU cash stocks
Lisa O’Carroll
The number of banknotes in circulation in the EU is increasing despite widespread smartphone payments, new data shows, with wildfires ripping through parts of Europe fuelling demand for an emergency stash of cash.
While cash plays second fiddle to contactless payments in many cities across Europe, the amount in circulation is actually going up, Philip Lane, the chief economist of the European Central Bank (ECB), said at the MacGill summer school conference in Ireland.
The rise of cash has been linked to anxiety over wars and the impact of cyber-attacks on online and contactless payment systems, say experts.
Lane said:
The total stock of banknotes is continuing to grow. In transactions, it [the number of notes] is coming down, but in terms of the stock [it is increasing].”
In 2025, EU residents were advised to stockpile enough food, water and essentials for 72 hours in case of an emergency such as this summer’s catastrophic wildfires in France and Spain, floods or storms as well as potential cyber-attacks or other hostile events.
Households were encouraged to have a crisis pack including bottled water, a transistor radio, canned food and, critically, cash.
More than 31m notes are in circulation compared with 24m just before the pandemic in 2019, with the €50 note the most popular in 2025 followed by the €100.
Bitcoin has jumped over 20% this week
Graeme Wearden
Back in the financial markets, bitcoin has hit its highest level since mid-May as the dollar weakens.
It’s been a sizzling week for Bitcoin which has climbed to over $79,400 this morning, from below $63,000 last Friday – a jump of over 22%.
So far today, it’s up almost 6%.
Crypto assets are benefitting from a weaker dollar today, which has been under pressure since Treasury secretary Scott Bessent intervened to prop up US government bond prices this week:
Axel Rudolph, chief technical analyst at investing and trading platform IG, says the crypto rally has gone “into overdrive”, explaining:
Crypto has surged higher this week, with Bitcoin rallying around 20% and Ether climbing roughly 25% as a powerful wave of buying swept across the market.
The bullish move initially began with a short squeeze, with bearish positions being forced to unwind as prices smashed through key resistance levels, creating a self-reinforcing burst of momentum. After months of fragile sentiment, the speed and scale of the rebound shows just how quickly crypto can turn when liquidity improves and investors rush to chase the move.
It’s not quite Bob Dylan, but a note from Morgan Stanley may still be music to some people’s ears, given that it’s titled: “The Vibes, They Are A-Changin’”
Bruna Skarica, an analyst at the investment bank, gave the UK economy this effusive praise in the note to clients this morning:
Sentiment in the UK has recovered from the post-energy shock lows. Underlying inflationary pressures look under control. Public finances are weathering the energy shock well too, due to robust tax receipts. Aided by a patient BoE and the tailwinds of global growth, UK economy is in an OK place.
She pointed to improving consumer confidence (see earlier post) and PMI results as the main bit of evidence, adding:
The totality of the evidence is consistent with a consumer that is feeling a bit more reassured about the economy and their personal finances than a few months ago.
And even on the fall in retail sales in July, she suggested this was mainly due to May and June being boosted by promotions being brought forward because of the early-summer heatwaves.
Skarica added:
We suspect part of the issue is earlier discounting this year, which in interaction with ONS seasonality adjustment, yielded artificially strong numbers for May and June, and an optically severe correction in July.
And while we’re back on retail sales, here’s our full report on the ONS data released this morning…
Can Andy Burnham fix the north’s rail services?
Improving economic sentiment is not the only challenge facing Andy Burnham heading into the autumn – he also has the unenviable task of trying to turn around Britain’s beleaguered rail network.
The prime minister, speaking in 2025 about rail routes in the north of England when he was still the mayor of Greater Manchester, said:
What is it about the rail industry which makes them think they can treat passengers in the north as second-class citizens?
Our transport correspondent, Gwyn Topham, reports on the job at hand…
Mark Zuckerberg buys 440-acre Strancally castle estate in Ireland
Rory Carroll
Mark Zuckerberg and his wife, Priscilla Chan, have bought Strancally castle, a gothic-style mansion in Ireland, for roughly €20m.
The castle, which comes with a 178-hectare (440-acre) estate in county Waterford, have been bought by the Meta chief exxecutive to use as a base during visits to Ireland.
A spokesperson said on Thursday:
Mark and his family are excited to continue caring for this historic home and look forward to spending time in Ireland, where Meta maintains its international headquarters.”
The price paid in the off-market deal is not known but the Irish Times, which first reported the sale, estimated a value between €20m (£17m) and €30m: approximately 10% of the cost of his 387ft superyacht.
The castle was built in 1830 for John Keily, a former Conservative MP, and designed on a lavish scale by the architects James and George Richard Pain, with a “brisk walk of four and a half minutes” needed to go from the dining room to the kitchen, according to the book The Houses of Ireland.
Consumer confidence hit its highest level in two years in August
In another positive sign for the economy, consumer confidence has hit a two-year high in August, according to a survey released overnight.
A long-running monthly index measuring consumer sentiment by GfK improved to -14, up from -17 in July (though yes, those figures are still in the minuses…).
Neil Bellamy, consumer insights director at GfK, sounded a note of caution:
Does all this mean that people have greater faith in the new government to increase growth and job opportunities? Can consumers finally see an end to the cost-of-living crisis? It would be tempting to say yes, but frankly it’s too soon to tell.
The survey found that more people think it is a good time to make a major purchase, with that part of the index rising five points compared with July to -7. The index measuring personal finances, meanwhile, ticked up two points to -6.
It comes after a swathe of measures from Prime Minister Andy Burnham designed to alleviate the pressure on household finances, such as capping bus fares and cutting VAT from energy bills.
While those negative readings may not look terribly optimistic, they are at least heading in the right direction. Whether that continues with rising energy bills and a Budget around the corner is another matter…
Thomas Pugh, the chief economist at consultancy RSM UK, added:
Consumer confidence rose to a two-year high in August, suggesting that consumers remain unfazed about renewed tensions in Iran and the risk of another tax-raising budget in the autumn.
Ministers urged to cut cost of loans for solar panels on UK homes
Fiona Harvey
Away from this morning’s stream of economic data, a thinktank is urging ministers to make solar panels cheaper for people on lower incomes.
Solar panel installations can save households hundreds of pounds a year in energy bills, but at an initial cost of about £5,000 to £10,000 they are beyond the reach of many households.
Loans are offered by some commercial companies to enable people to repay the cost over a longer period, but these come at high interest rates that can wipe out most of the energy bill savings for the first decade.
The rising cost of gas is set to pile on further hardship this winter, with the cap on UK energy prices likely to rise by 4% from this October to the equivalent of £1,729 a year for the rest of the year, according to forecasts published this week.
The Common Wealth thinktank is urging the government to step in by providing a universal entitlement to solar panels, which would be paid for by “solar bonds”.
These would be retail investment products that the government could offer on a similar model to national savings investments, or premium bonds – savers would receive interest payments on their cash in return for funding the scheme.
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