The gold price showed little reaction to the apparent end of the crisis in Washington on Wednesday, hovering around its opening levels of 1,273 an ounce on the news of a likely deal.
At 12:30 EST in trade on the Comex market in New York December gold futures changed hands at $1,273.50, well off its highs for the day of $1,289 an ounce.
According to reports senate leaders agreed on a plan to fund the federal government through January 15 and lift the debt ceiling for government borrowing to continue till February 7.
A committee to iron out wider budget issues will be formed with a deadline of December 13 to report on a new budget plan. The Senate and House still need to vote on the agreement.
Contrary to conventional wisdom in the gold market, the metal didn’t capitalize on its status as a safe haven during the negotiations between Republicans and Democrats to end the US government shutdown and to lift the country’s debt ceiling.
Gold remains around 1% below the levels it traded at on September 30, the day before the shutdown began, failing to attract safe haven buying ahead of a possible default which would have wreaked havoc on global financial markets.
