Gold trades in a tight range in the Asian trading session

1 Jun 2023 , 11:11 AM

As traders concentrated on the U.S. debt ceiling vote, gold prices increased slightly in early Asian trade on Thursday, aided by a weaker dollar.

Spot gold increased 0.2% to $1,965.61 per ounce. Futures for U.S. gold increased 0.2% to $1,965.20.

The dollar index dropped from a two-month high, lowering the price of bullion for international purchasers.

On Wednesday, a bill to raise the U.S. government’s debt ceiling to $31.4 trillion and prevent a catastrophic default passed a crucial procedural test in the House of Representatives, clearing the way for a vote on the bipartisan debt agreement itself.

The prospect of a U.S. default has been seen by investors as an unlikely but potentially disastrous development for world markets. A vote in favour of the measure in the House would send it to the Senate, where it might be debated until the weekend before June 5, when the government might start to run out of money.

Data for the previous month was revised higher. U.S. job postings unexpectedly increased in April, indicating ongoing strength in the labour market that may force the Federal Reserve to increase interest rates in June.

Higher interest rates make zero-yield bullion less appealing.

As prices on the global market corrected, India reduced the base import prices of gold and silver.

The price of spot silver increased by 0.1% to $23.5052 per ounce, platinum increased by 0.3% to $996.62, and palladium increased by 0.8% to $1,372.70.

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