Gold has rebounded sharply in August, with UBS reporting a 17% gain while spot gold was later quoted near $4,583 an ounce, up roughly 13% for the month and 33% over the past year. Gold-mining stocks have gained even more, with the MSCI Inc. global gold miners index up 43%, its strongest monthly performance on record, surpassing the best monthly gains by semiconductor indexes. UBS says the rally reflects a shift from trading interest-rate expectations toward a debasement trade, or positioning for erosion in fiat-currency value. The move accelerated after the U.S. Treasury said it would double its buyback cap for longer-dated debt to at least $4 billion, reviving fiscal-sustainability concerns and demand for scarce assets including gold, silver, copper and Bitcoin. UBS describes the gold rebound as a two-phase move: an initial fundamentals-driven technical recovery supported by light positioning, resilient physical demand, central-bank purchases and weaker U.S. economic data, followed by a fiscal-credit rally after the Treasury announcement. The bank says gold’s valuation is shifting from an opportunity-cost framework, in which higher real rates weigh on a non-yielding asset, toward a fiscal-credit framework in which elevated yields caused by sovereign-risk concerns may support gold. UBS lowered its 2026 year-end gold target by 6% to $4,675 an ounce from $5,000, while leaving its 2027 and later forecasts unchanged, including an upside scenario of as much as $6,500. Gold-backed ETF holdings rose at their fastest rate since September after $3 billion of inflows in July ended two consecutive months of outflows. Bitcoin gained roughly 26% in August, while copper reached a record close, reinforcing the broader scarce-assets trade. UBS says a hawkish Federal Reserve remains the main near-term risk: higher real yields and a stronger dollar could cause a steep correction, particularly amid thin summer liquidity, although the bank would view such a pullback as a buying opportunity unless stronger-than-expected artificial-intelligence-driven growth gives the Fed room for aggressive rate increases. Markets are focused on Federal Reserve Chair Kevin Warsh’s Jackson Hole speech, with a softer message potentially keeping the debasement trade intact into September.