Gold Range-bound on Firmer Dollar, US Debt Limit Uncertainty

Ingots of 99.99 percent pure gold are placed in a workroom at Krastsvetmet precious metals plant in the Siberian city of Krasnoyarsk, Russia, January 31, 2023. REUTERS/Alexander Manzyuk
Ingots of 99.99 percent pure gold are placed in a workroom at Krastsvetmet precious metals plant in the Siberian city of Krasnoyarsk, Russia, January 31, 2023. REUTERS/Alexander Manzyuk
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Gold Range-bound on Firmer Dollar, US Debt Limit Uncertainty

Ingots of 99.99 percent pure gold are placed in a workroom at Krastsvetmet precious metals plant in the Siberian city of Krasnoyarsk, Russia, January 31, 2023. REUTERS/Alexander Manzyuk
Ingots of 99.99 percent pure gold are placed in a workroom at Krastsvetmet precious metals plant in the Siberian city of Krasnoyarsk, Russia, January 31, 2023. REUTERS/Alexander Manzyuk

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 by 0519 GMT. US gold futures fell 0.3% to $1,958.80.

Rival safe-haven dollar scaled to its highest since mid-March, making gold less attractive for overseas buyers, Reuters said.

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.

Investors will also scan US GDP estimates and initial jobless claims due at 1230 GMT for guidance on the economy's health.

Spot silver fell 0.2% to $23.03 per ounce, platinum eased 0.3% to $1,021.23, palladium edged 0.1% lower to $1,413.96.

"Platinum is regaining investor attention as fundamentals improve. South African mining challenges weigh on supply recovery this year, while demand is getting support from gold as well as the ongoing substitution away from palladium," ANZ said in a note.



Euro 2024 Tourism to Bring 1$ Billion to Germany, Study Shows 

The words "Welcome to Berlin" can be read shortly before sunrise on a display in the fan zone (Platz der Republik) against the backdrop of the Reichstag and the TV tower in Berlin on Friday, June 14, 2024. (dpa/AP)
The words "Welcome to Berlin" can be read shortly before sunrise on a display in the fan zone (Platz der Republik) against the backdrop of the Reichstag and the TV tower in Berlin on Friday, June 14, 2024. (dpa/AP)
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Euro 2024 Tourism to Bring 1$ Billion to Germany, Study Shows 

The words "Welcome to Berlin" can be read shortly before sunrise on a display in the fan zone (Platz der Republik) against the backdrop of the Reichstag and the TV tower in Berlin on Friday, June 14, 2024. (dpa/AP)
The words "Welcome to Berlin" can be read shortly before sunrise on a display in the fan zone (Platz der Republik) against the backdrop of the Reichstag and the TV tower in Berlin on Friday, June 14, 2024. (dpa/AP)

Germany, the host of Euro 2024, can expect a 1 billion euro ($1.07 billion) boost to its economy thanks to foreign tourists traveling to the country for the soccer games, the ifo institute forecasts.

This corresponds to about 0.1% of economic output in the second quarter of the year, with Germany´s hospitality and food retail sectors set to benefit the most from the games, the country's top economic research institute said.

"However, the effect is only short-lived, so that exports of services due to returning tourists are likely to fall again after the end of the European Championship in the third quarter and remain the same on balance," ifo researcher Gerome Wolf said.

More than an additional 600,000 foreign tourists and 1.5 million additional overnight stays are expected during the Championship, according to the institute's calculations based on the numbers from the FIFA World Cup hosted by Germany in 2006.

The German Economy Ministry also expects a temporary upturn in consumer-facing sectors after very subdued retail sales this year, but not to the same extent as during the 2006 World Cup.

Experts agree that the overall effect of the Euro 2024 on Europe’s largest economy also depends on how the German national team performs in the tournament.

Their match against Scotland will kick off the tournament on Friday evening.