Yesterday, the US Senate passed President Trump's 'Big Beautiful Bill'. 

As the Motley Fool's Sebastian Bowen wrote, this budget bill is one of the most controversial in American history. 

It increases the US national debt by up to US$3.3 trillion over the next decade, funded by tax cuts, abolishing taxes on tips and overtime, and increasing spending on defence and border security. It also makes large cuts to US healthcare programs, including Medicaid.

Why are investors concerned about the US debt?

According to JP Morgan, investors started paying attention to the US fiscal trajectory after ratings agency S&P Global downgraded the debt in 2011. 

Recently, the interest cost (of US debt) has increased dramatically following the US Federal Reserve's most aggressive interest rate hiking cycle in 40 years to curb inflation. The US government now spends around US$882 billion annually on interest payments. For context, this is even higher than defence spending.

On 16 May 2025, fellow ratings agency Moody's also downgraded its US debt rating from Aaa (the top level) to Aa1 (one notch below).

Investors flock to safe havens

The gold price rose more than 1% yesterday as the bill passed the Senate.

The legislation now heads to the US House of Representatives. If it passes, it could boost gold's appeal as a safe haven even further, according to Bloomberg. 

Historically, gold has thrived on political and economic uncertainty.

Gold has risen more than 25% this year, driven by geopolitical and trade tensions. 

In April, global exchange-traded funds (ETFs) backed by gold bullion reported their highest monthly inflows for more than three years. Holdings reached levels not seen since the peak of the pandemic era in October 2020.

On 28 June, JP Morgan wrote that multi-asset portfolios should still deliver meaningful returns for investors, despite the medium-term trajectory for US debt or deficits. 

JP Morgan also wrote:

That said, the risks are meaningful enough to consider adding non-U.S. dollar denominated assets and "real assets" such as infrastructure, gold and commodities to traditional multi-asset portfolios.

How should Australian investors position their portfolio?

Australian investors looking to gain exposure to gold have several options.

They can directly buy physical gold bullion through the Perth Mint.

Alternatively, they can gain exposure to gold through exchange-traded funds (ETFs). Gold ETFs are traded like any other share on the ASX, meaning they are highly liquid and can be traded during market hours. 

One option is the Global X Gold Bullion ETF (ASX: GXLD). With a management expense of just 0.15%, the GXLD ETF is the lowest-cost physically backed gold exchange-traded product in the market. It is up 20% year over year and 45% over the past year. 

ASX investors can also buy ASX 200 gold miners. 

Newmont Corporation (ASX: NEM) and Evolution Mining Ltd (ASX: EVN) have been top performers this year, rising 48% and 62% respectively. 

However, past performance is no guarantee of future performance. 

Despite its strong run, Newmont is Macquarie's top pick in the gold sector. On 27 June, Macquarie assigned a price target of $106 on Newmont shares, suggesting nearly 19% upside over the next 12 months from here.

Meanwhile, on 6 June, Macquarie placed an underperform rating on Evolution Mining shares with a price target of $6.30. This suggests around 20% downside from here. 

Foolish takeaway

Gold has been a strong asset for the year to date, supported by multiple tailwinds. The passage of Trump's budget bill could result in further support for the yellow metal. Investors looking to gain exposure to gold have several options. For those interested in gold miners, Macquarie believes Newmont is best positioned over the next 12 months.