Updated from 11:35 a.m. EST with settlement prices
Gold for February delivery lost $6.50 to settle at $1,686.70 an ounce at the Comex division of the New York Mercantile Exchange. The gold price traded as high as $1,694.80 and as low as $1,683.10 an ounce, while the spot price was slipping $6.10, according to Kitco's gold index.
The House voted Wednesday to temporarily suspend the debt ceiling and Senate Democratic leadership emerged to offer their support of the vote. Republicans made the decision to push the debt debate to a later date, and Democrats followed President Barack Obama's lead as his office released a statement late Tuesday that it was encouraged by a short-term solution. "[T]he Administration is encouraged that H.R. 325 lifts the immediate threat of default," an administration statement on policy said. "[T]he Administration would not oppose a short-term solution to the debt limit and looks forward to continuing to work with both the House and the Senate to increase certainty and stability for the economy." Avoiding a debt limit clash will delay fears of a repeat of the summer 2011 encounter that led to a protracted disagreement to raise the ceiling, which led to Standard & Poor's downgrade of the government's credit rating. Gold stood to benefit from the uncertainty of a debt limit disagreement, but the delay has led prices lower for Wednesday. The gold price during the trading session didn't slump significantly, though, because another major vote by Congress is quickly approaching to settle the sequester -- across the board spending cuts to the budget -- and an official budget vote for the fiscal year. Silver prices for March delivery added 26 cents to close at $32.44 an ounce, while the U.S. dollar index was up 0.10% to $79.95. Gold has been stuck in a tight trading range with few economic events or announcements to push it decidedly in one direction. "We seem to be moving away from that crisis mentality," said Stanley Dash, vice president of applied technology analysis at TradeStation Securities. "Gold hasn't moved in weeks."
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