<p>Gold prices rose on Friday after the dollar retreated from a two-month high, although bullion was poised for a third straight weekly drop as traders assessed the progress of the U.S. debt ceiling negotiations and the Federal Reserve's next policy move.</p>.<p>Spot gold rose 0.4 per cent to $1,947.86 per ounce by 0452 GMT, after hitting its lowest since March 22 at $1,936.59. US gold futures edged up 0.2 per cent to $1,948.40.</p>.<p>Still, bullion lost 1.5 per cent so far in the week.</p>.<p>There is an overwhelming market expectation that the debt crisis will be resolved, and a still overall tightening horizon from the Fed that is expected to put some downward pressure on gold, said Clifford Bennett, chief economist at ACY Securities.</p>.<p>"The Fed may indeed pause at the next meeting, as they should, given both the debt ceiling crisis, even with a resolution, and the ongoing, albeit in the background, banking crisis," Bennett said, adding some investors may be buying the dips in gold price.</p>.<p>The dollar dipped 0.2 per cent, but hovered near its highest level since March 17. Benchmark Treasury yields were also near highs seen in March.</p>.<p>US President Joe Biden and top congressional Republican Kevin McCarthy on Thursday appeared to be nearing a deal to cut spending and raise the government's $31.4 trillion debt ceiling, with little time to spare to head off the risk of default.</p>.<p>On the interest rate front, markets are now pricing in a 37.8 per cent chance of a 25-basis-point hike in June and seeing cuts no sooner than September, according to the CME FedWatch tool.</p>.<p>Gold could still reach $1,980 or close to the $2,000 level in June, supported by steady physical demand in key markets such as India and China and overall economic uncertainty, said Ajay Kedia, director at Kedia Commodities in Mumbai.</p>.<p>Spot silver rose 0.7 per cent to $22.94, platinum and palladium each advanced 0.8 per cent to $1,028.71 and $1,428.38, respectively.</p>
<p>Gold prices rose on Friday after the dollar retreated from a two-month high, although bullion was poised for a third straight weekly drop as traders assessed the progress of the U.S. debt ceiling negotiations and the Federal Reserve's next policy move.</p>.<p>Spot gold rose 0.4 per cent to $1,947.86 per ounce by 0452 GMT, after hitting its lowest since March 22 at $1,936.59. US gold futures edged up 0.2 per cent to $1,948.40.</p>.<p>Still, bullion lost 1.5 per cent so far in the week.</p>.<p>There is an overwhelming market expectation that the debt crisis will be resolved, and a still overall tightening horizon from the Fed that is expected to put some downward pressure on gold, said Clifford Bennett, chief economist at ACY Securities.</p>.<p>"The Fed may indeed pause at the next meeting, as they should, given both the debt ceiling crisis, even with a resolution, and the ongoing, albeit in the background, banking crisis," Bennett said, adding some investors may be buying the dips in gold price.</p>.<p>The dollar dipped 0.2 per cent, but hovered near its highest level since March 17. Benchmark Treasury yields were also near highs seen in March.</p>.<p>US President Joe Biden and top congressional Republican Kevin McCarthy on Thursday appeared to be nearing a deal to cut spending and raise the government's $31.4 trillion debt ceiling, with little time to spare to head off the risk of default.</p>.<p>On the interest rate front, markets are now pricing in a 37.8 per cent chance of a 25-basis-point hike in June and seeing cuts no sooner than September, according to the CME FedWatch tool.</p>.<p>Gold could still reach $1,980 or close to the $2,000 level in June, supported by steady physical demand in key markets such as India and China and overall economic uncertainty, said Ajay Kedia, director at Kedia Commodities in Mumbai.</p>.<p>Spot silver rose 0.7 per cent to $22.94, platinum and palladium each advanced 0.8 per cent to $1,028.71 and $1,428.38, respectively.</p>