Singapore, July 29 (Newswire): Gold held steady on Friday, heading for its fourth straight week of gains, as investors watched US debt ceiling talks after Republicans delayed a vote on the debt plan.
The US House of Representatives decided not to vote on a plan to raise the debt limit and Republican leaders have struggled to line up support for the measure.
The delay of the vote fuelled uncertainty whether Washington would reach an agreement in time, depressing the dollar and equities, as the clock ticks down to the August 2 deadline.
"There is far too much uncertainty and no one is that keen to take a position right now," said a Singapore-based trader.
"Even if the plan makes it through the Congress, it is not guaranteed to pass the Senate and we'll be back to square one."
Spot gold was flat at $1,615.99 an ounce by 0346 GMT, on course for a weekly rise of 1.2 percent. It was headed for a monthly gain of nearly 8 percent, its second best month of this year after April.
US gold edged up 0.2 percent to $1,615.90.
"The gold market is likely to continue its two-sided trade in the near term, with the debt ceiling debate remaining the central focus," said MF Global in a research note, adding that a deal to avert a downgrade or default could result in a sharp drop in prices.
Investors have fled riskier assets in recent weeks on worries about US debt talks and the euro zone crisis, setting gold on the path of a record-setting rally. It reached an all-time high at $1,628 on Wednesday.
The world's largest gold-backed exchange-traded fund, SPDR Gold Trust , said its holdings rose 1.5 percent from a day earlier to a six-month high of 1,262.98 tonnes by July 28.
Technical analysis suggested that gold may fall towards $1,593, said Reuters market analyst Wang Tao.
Spot silver was little changed at $39.68 an ounce, off a more than two-month high of $41.42 hit this week. It was set to rise nearly 15 percent in July, its best month since April. But on the weekly chart, silver lagged behind gold, with a 0.7 percent drop.
US silver edged down 0.2 percent to $39.72.
"Some people are already pricing in the expectation that the United States will eventually avert a default," said a Tokyo-based trader, adding that high prices in recent weeks had encouraged some Chinese smelters to export more silver.
"Silver should have strong support around $38, while the situation in Europe and the United States continues to buoy appetite in gold and benefit silver."
But silver is unlikely to score new highs in the absence of new supportive factors, he said.
Spot palladium was headed for a monthly rise of nearly 10 percent, its best this year. The metal, used mainly in producing autocatalysts, was on course for a weekly gain of 2.6 percent, outperforming other precious metals.
The US House of Representatives decided not to vote on a plan to raise the debt limit and Republican leaders have struggled to line up support for the measure.
The delay of the vote fuelled uncertainty whether Washington would reach an agreement in time, depressing the dollar and equities, as the clock ticks down to the August 2 deadline.
"There is far too much uncertainty and no one is that keen to take a position right now," said a Singapore-based trader.
"Even if the plan makes it through the Congress, it is not guaranteed to pass the Senate and we'll be back to square one."
Spot gold was flat at $1,615.99 an ounce by 0346 GMT, on course for a weekly rise of 1.2 percent. It was headed for a monthly gain of nearly 8 percent, its second best month of this year after April.
US gold edged up 0.2 percent to $1,615.90.
"The gold market is likely to continue its two-sided trade in the near term, with the debt ceiling debate remaining the central focus," said MF Global in a research note, adding that a deal to avert a downgrade or default could result in a sharp drop in prices.
Investors have fled riskier assets in recent weeks on worries about US debt talks and the euro zone crisis, setting gold on the path of a record-setting rally. It reached an all-time high at $1,628 on Wednesday.
The world's largest gold-backed exchange-traded fund, SPDR Gold Trust , said its holdings rose 1.5 percent from a day earlier to a six-month high of 1,262.98 tonnes by July 28.
Technical analysis suggested that gold may fall towards $1,593, said Reuters market analyst Wang Tao.
Spot silver was little changed at $39.68 an ounce, off a more than two-month high of $41.42 hit this week. It was set to rise nearly 15 percent in July, its best month since April. But on the weekly chart, silver lagged behind gold, with a 0.7 percent drop.
US silver edged down 0.2 percent to $39.72.
"Some people are already pricing in the expectation that the United States will eventually avert a default," said a Tokyo-based trader, adding that high prices in recent weeks had encouraged some Chinese smelters to export more silver.
"Silver should have strong support around $38, while the situation in Europe and the United States continues to buoy appetite in gold and benefit silver."
But silver is unlikely to score new highs in the absence of new supportive factors, he said.
Spot palladium was headed for a monthly rise of nearly 10 percent, its best this year. The metal, used mainly in producing autocatalysts, was on course for a weekly gain of 2.6 percent, outperforming other precious metals.
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