Gold Turn Lower on Debt Deal Reports

Gold futures turned lower Thursday afternoon following a report from the New York Times that U.S. President Barack Obama and congressional Republicans agreed in principle to a deal to raise the debt ceiling.

However, House Speaker John Boehner and White House press secretary Jay Carney each quickly denied the report.

In a Twitter message, Boehner called the report “false” and urged the Senate to approve the Republican “cut, cap and balance” bill, while Carney said the report was “incorrect” and that discussions remains “fluid.”

Gold initially fell to $1,590 on the report, climbed back to $1,595 following Boehner’s denial, but subsequently dropped to $1,588 per ounce.

Silver turned south alongside gold, falling $0.42, or 1.1%, to $39.14 per ounce.

The U.S. Dollar Index showed a muted reaction to the reports, remaining lower by 0.9% at 74.405.

U.S. equity markets extended their gains following the reports, as the Dow Jones Industrial Average (DJIA) advanced 158.14 points, or 1.3%, to 12,730.05.