XAU/USD fell nearly 1% during the intraday trading session on Wednesday after US economic data showed that business activity and the labor market showed signs of strengthening more than expected.
At 9 am, gold was at $4,456, having held steady since opening early Thursday in Asian trading.
The market was focused on the ISM Services PMI report, which surprisingly beat estimates and previous data, while the ADP Employment Change for December remained strong but missed market expectations.
The JOLTS data release showed a decline compared to October, but overall, the data has not yet been able to change market players' expectations for Federal Reserve (Fed) monetary policy easing in 2026.
Data from Prime Market Terminal showed that the US central bank is projected to cut interest rates at least twice by the end of the year, thus seeing the Fed funds rate in the range of 3.00 to 3.25 percent.
However, bullion prices remain under pressure despite heightened geopolitical risks following the arrest of Venezuelan President Nicolas Maduro last week.
US President Donald Trump has also expressed his desire to take over Greenland, including possible military involvement.
This week, the US economy is set to release Initial Jobless Claims data and the Non-Farm Payrolls (NFP) report for December, which could potentially push gold prices higher if the labor market continues to show signs of weakness.
