2023.05.3110:21:00UTC+00Gold Prices Little Changed Ahead Of House Vote On US Debt Ceiling Bill

Gold prices fell slightly on Wednesday and were on track for a monthly loss due to hawkish Fed expectations and signs of progress in the U.S. debt ceiling deal.

Spot gold edged down 0.1 percent to $1,957.81 per ounce, with an overnight decline in Treasury yields helping cap the downside. U.S. gold futures were down 0.1 percent at $1,975.55.

The dollar index traded near its highest level since March, denting the appeal for bullion.

The debt-limit deal struck by U.S. President Joe Biden and Speaker Kevin McCarthy is heading toward a vote later today in the House of Representatives after clearing a crucial procedural hurdle.

The agreement in principle will raise the debt ceiling for two years and keep non-defense spending roughly flat for fiscal 2024 and increase it by 1 percent in fiscal year.

In economic releases, flash figures released earlier today showed French inflation eased to 6 percent from 6.9 percent in April. Germany's CPI report is due later in the day ahead of a euro zone flash reading on Thursday.

Elsewhere, official data from China showed manufacturing activity in the country continued to contract in May, and at a faster rate.

U.S. MBA weekly mortgage data, Chicago PMI for May, Dallas Fed services index for May and the Federal Reserve Beige book report are due in the New York session.