Gold prices were flat on Thursday as the dollar advanced to an over two-month high and sapped demand for the greenback-priced metal, while investors awaited further developments in the drawn-out debt ceiling negotiations in Washington.
Spot gold was flat at $1,957.09 per ounce. US gold futures fell 0.3 percent to $1,958.80.
Rival safe-haven dollar scaled to its highest since mid-March, making gold less attractive for overseas buyers.
Bullion has been attempting to recover from its previous sell-off, but a stronger dollar and higher US Treasury yields continue to keep the upside in check, which seems to override safe-haven flows around the US debt ceiling situation, said Yeap Jun Rong, a market analyst at IG.
US Treasury Secretary Janet Yellen on Wednesday maintained early June as a debt ceiling default deadline and said she will update Congress shortly about government finances.
Negotiators for Democratic President Joe Biden and top congressional Republican Kevin McCarthy held what both sides called productive talks on Wednesday to try to reach a deal to raise the United States’ $31.4 trillion debt ceiling and avoid a catastrophic default.
Investors also took stock of minutes of the May 2-3 Federal Reserve meeting that showed policy makers “generally agreed” last month that the need for further interest rate increases “had become less certain,” with several saying the quarter-percentage-point hike they approved might be the last.
