Concerns that ongoing debt discussions may be too little too late and that the United States is slipping into a technical default continue to push short-term U.S. Treasury bond yields to levels not seen in decades. One-month Treasury bills are currently trading at a yield of about 5.65 percent as investors demand more money during the negotiations. Although both sides say the ongoing dialogue has been productive, talks between President Biden and House Speaker Kevin McCarthy have so far produced little impact, while President Biden added that a default is "off the table." Treasury Secretary Janet Yellen recently said that if a deal is not reached by early June, there is a "strong possibility" that a debt default will continue to roil markets.

While gold is currently battling high US bond yields, the week starting later today has some important US economic data releases and events for gold traders to consider. The latest FOMC minutes tonight should give the market a more detailed look at what was discussed at the last meeting, ahead of the US second-quarter GDP data on Thursday. On Friday, the core personal consumption expenditures (PCE), the Fed's preferred inflation measure, will be released at 12:20 GMT, followed by the final Michigan consumer sentiment report for May.

Gold remained near its recent multi-week low of $1,952 an ounce. If US bond yields rise further, that level could be retested. The sell-off started from a multi-decade high of $2,081 an ounce on May 4. Has been relentless and hardly seen any sustained rally. If gold is to move higher, the 20-day and 50-day moving averages show resistance at $1,993 /0z. And $2,001 per ounce. It needs to be taken out convincingly.