Gold strengthens amid protracted US debt ceiling talks

May 15 (Reuters) – Gold prices rose on Monday after three consecutive sessions of retreat as the dollar weakens and investors remain concerned about the possible outcome of the U.S. government debt ceiling deadlock, which could fuel fears of a global economic slowdown.

Gold spot price rose 0.23% to $2,015.7 a troy ounce at 1:17 p.m. Moscow time, after falling to its lowest level since May 5 on Friday.

“The price of the precious metal is still supported above $2,000 by continued concerns about the ongoing US debt ceiling talks and hopes the Fed will not raise rates any more,” Exinity’s Khan Tan said.

The flash reading of the US Consumer Sentiment Index in May fell to a six-month low on fears that ongoing political battles over an increase in the credit limit could lead to a recession.

US President Joe Biden said on Sunday that he expected to meet with representatives of Congress on Tuesday to negotiate an increase in the amount of public debt and prevent a catastrophic default.

“However, gold risks a temporary return below $2,000 due to rising risk appetite over a deal to raise the U.S. debt ceiling in the near term,” Tan said.

He added that the precious metal could also be forced to part with another batch of recent gains if Fed officials signaled another rate hike.

Palladium rose 1.21% to $1,527.57 an ounce, while silver gained 0.51% to $24.03 an ounce.

The platinum price rose 0.96% to $1,059.64.

The original message in English is available at the code: (Arundhati Sarkar in Bangalore)