Fed rate hike uncertainty lends some support to XAU/USD

Additional details of the closely-watched US jobs data, however, revealed that the Unemployment Rate rose to 3.7% as compared to an expected uptick to 3.5% from 3.4% in April. Furthermore, Average Hourly Earnings edged lower to 4.3% from 4.4% and pointed to signs of moderating wage growth. This, along with less hawkish remarks by a slew of Fed officials last week, fueled speculations about an imminent pause in the US central bank's rate-hiking campaign. This, in turn, is holding back traders from placing aggressive bearish bets around the non-yielding Gold price and helping limit further losses, at least for the time being.

Risk-on mood should cap any attempted recovery in Gold price

The upside, meanwhile, remains capped amid the prevalent risk-on environment, which tends to undermine traditional safe-haven assets, including the XAU/USD. Investors continue to cheer the optimism over the passage of legislation to lift the government's $31.4 trillion debt ceiling to avert an unprecedented American default. Adding to this, a private-sector survey showed on Monday that China's services activity picked up in May and remains supportive of a generally positive tone around the equity markets. This, in turn, could act as a headwind for the Gold price and warrants some caution for aggressive bullish traders