Gold prices inched higher on Tuesday as investors awaited clarity on U.S. debt ceiling talks and looked ahead to the release of key U.S. inflation data this week for additional clues on the outlook for rates.
Spot gold rose 0.3 percent to $2,028.01 per ounce, while U.S. gold futures were up 0.1 percent at $2,035.10.
The dollar edged higher against major currencies ahead of U.S. reports on consumer and producer price inflation, which are due to be released on Wednesday and Thursday, respectively.
CME Group's FedWatch Tool currently indicates an 88.0 percent chance the Federal Reserve will leave interest rates unchanged at its next meeting in June.
The debt ceiling standoff gives a reason for caution, with the president expected to host the House speaker and other congressional leaders at the White House later today to discuss their impasse over the debt ceiling and spending cuts.
On the data front, fresh data showed China's imports contracted sharply in April and exports grew at a slower pace, reinforcing signs of feeble domestic demand despite the lifting of Covid-19 controls.
