Gold Price Stuck Ahead of US NFP Data Release

The gold price (XAU/USD) remains stuck in a tight range around $4,050 during the European trading session on Tuesday. Investors are waiting for the US Nonfarm Payrolls (NFP) data for July, which will be released later this week.

Economists at Deutsche Bank expect Friday's US July payrolls report to show a modest acceleration in hiring, with employment growth of +65k, moderately above June's +57k reading. They forecast the Unemployment Rate to remain at 4.2%, although risks are skewed towards a rounding up to 4.3% if labour force participation rebounds after last month's sharp decline.

The data will influence market expectations for the Federal Reserve's (Fed) monetary policy outlook, and there is a 63.6% chance that the Fed will hike interest rates in the September policy meeting. Higher interest rates by the Fed bode poorly for non-yielding assets, such as Gold.