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Dollar debasement is now a key theme driving gold price higher: TD Securities

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(Kitco News) Gold prices are trading near new record highs after rising above $1,940 an ounce for the first time ever on Monday and beating the previous all-time high of $1,920 an ounce. The new key theme driving gold higher is the U.S. dollar debasement, according to TD Securities commodity strategists. “The USD weakens amid massive fiscal & central bank stimulus, a bloating debt pile and a slow growth environment,” they write. Also, real rates are heading lower, which is also pushing gold higher, the strategists added. August Comex gold futures are currently trading at $1,931.20, up 1.78% on the day. Retail traders are playing a major role in the precious metals rally, showing rising interest in gold and silver. “It appears that one cohort's behavior in particular may have contributed — retail traders. Specifically, the evidence suggests that a surge in retail interest may be helping silver outperform,” the strategists say. “For precious metals bulls, the risk at this week's FOMC relates to the duration adjustment required as auction sizes are set to significantly increase, which could generate a supply-demand mismatch and pressure long end rates should they keep the composition unchanged.”

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