• Gold price gains some positive traction on Thursday, albeit lacks follow-through.
• Bets for more rate hikes by Federal Reserve underpin the US Dollar and cap gains.
• A positive risk tone also contributes to keeping a lid on the safe-haven commodity.

Gold price ticks higher during the Asian session on Thursday and reverses a part of the previous day's decline to the $1,933-$1,932 region, or a three-week low. The XAU/USD currently trades with a mild positive bias around the $1,937-$1,938 area, up nearly 0.20% for the day, though any meaningful appreciating move still seems elusive.

The US Dollar (USD) enters a bullish consolidation phase and witnesses a subdued/range-bound price action near its highest level since July 7. This, in turn, is seen as a key factor lending some support to the US Dollar-denominated Gold price. The downside for the USD, meanwhile, remains cushioned in the wake of firming expectations that the Federal Reserve (Fed) will keep interest rates higher for longer. This, in turn, might hold back traders from placing aggressive bullish bets and cap the upside for the non-yielding yellow metal.

The ADP National Employment report showed on Wednesday that private-sector employers in the United States (US) added 324K jobs in July as compared to the 189K anticipated. This points to continued labour market resilience and should shield the economy from a recession, allowing the Fed to stick to its hawkish stance. The expectations keep the US Treasury bond yields elevated, which supports prospects for a further near-term move up for the USD and suggests that the path of least resistance for the Gold price is to the downside.

Investors, meanwhile, now seem to have digested the Fitch downgrade of the US government's credit rating to AA from AAA late Tuesday. Adding to this, China's Caixin Services PMI unexpectedly rose to 54.1 in July from 53.9 in the previous month and leads to a slight recovery in the global risk sentiment. This is evident from a modest rebound in the US equity futures, which might further contribute to keeping a lid on the safe-haven Gold price and adds credence to the negative outlook, warranting some caution for bullish traders.

Market participants now look forward to the US economic docket – featuring the release of the usual Weekly Initial Jobless Claims, the ISM Services PMI and Factory Orders later during the early North American session. This, along with the US bond yields, might influence the USD price dynamics and provide some impetus to the Gold price. Apart from this, traders will take cues from the broader risk sentiment to grab short-term opportunities, though the focus remains on the US jobs data, popularly known as the NFP report on Friday.