Gold dips as U.S. hurries to resolve budget impasse

Last Updated: Wed, Oct 16, 2013 04:46 hrs

​Gold slipped for a fifth session out of seven on Wednesday as safe-haven bids slowed on hopes U.S. lawmakers would hash out a last-minute agreement to raise the debt ceiling before a Thursday deadline.


Spot gold had fallen 0.4 percent to $1,275.69 an ounce by 0022 GMT. It gained 0.6 percent on Tuesday as safe-haven buying emerged on fears the U.S. credit rating could be cut.

Democratic and Republican leaders in the U.S. Senate could announce a deal late on Tuesday to extend the government's borrowing authority until February 7 and quickly re-open federal agencies that have been closed since October 1, a Senate aide said.

Fitch Ratings warned it could cut the sovereign credit rating of the United States from AAA, citing the political brinkmanship over raising the debt ceiling.

"Reckless" U.S. fiscal policy will likely force the Federal Reserve to stand pat on monetary policy this month, said Dallas Fed president Richard Fisher.

Gold premiums in India, the world's biggest buyer of the precious metal, hit a record $100 an ounce, about 8 percent over London prices, on a shortage of supplies to meet festival demand, traders said on Tuesday.


Asian stocks eased and the dollar nursed losses on Wednesday.

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