On Wednesday, gold prices dipped below critical levels as the dollar and Treasury rates recovered in response to anxiety surrounding the US debt ceiling.

Spot gold nudged up by 0.1% at $1,991.76 per punce meanwhile gold futures ticked up to $ 1,995.85 per ounce. The two instruments roughly slid by 1.5% on Tuesday.

In the recent sessions, gold also experienced some profit-taking after surging to new highs earlier this month. However, recent declines caused gold to breach the closely watched $2,000 per ounce support barrier.

As discussions over raising the U.S. debt ceiling continued in advance of a June 1 deadline, a recovery in the greenback and U.S. Treasury yields put pressure on the yellow metal.

Now scheduled to speak on Friday and provide additional monetary policy hints is Fed Chair Jerome Powell.

As the opportunity cost of keeping non-yielding assets rises, gold may come under greater pressure in the near term as U.S. interest rates are anticipated to remain higher for longer.