Gold Price Forecast: XAU/USD snaps a losing streak, trades higher around $1,920

Gold price snaps five-day losing streak, trading higher around $1,920, up by 0.20% during the Asian session on Thursday. However, the bright metal is facing downward pressure as traders factor in the odds for a 25 basis points (bps) interest rate hike by the US Federal Reserve (Fed) through the end of the year 2023.

The hawkish sentiment surrounding the Fed policy decision in the upcoming meeting in September, is continues to support the US Treasury yields. This reinforces the confidence of US Dollar (USD) bulls. The 10-year US bond yield rose to 4.28%, up by 0.05% at the time of writing. US Dollar Index (DXY) hovers around 104.80, which measures the value of the Greenback against the six other major currencies.

Additionally, US ISM Services PMI rose to a six-month high reading of 54.5 in August against the expectations of 52.5 and 52.7 prior. While the S&P Global Composite and Services PMIs fell to 50.2 and 50.5 compared to the market consensus of 50.4 and 51.0. It is worth noting that moderate US data provided support in underpinning the buck.

Investor sentiment remains dampened due to worries over the deteriorating economic situation in China and the ongoing trade tensions between the United States and China. These factors are casting a shadow over the minds of investors and undermining the Gold price.

However, it is worth noting that the bearish tone prevailing in the equity markets might offer some limited support to the price of precious metal, given a safe-haven status.

The trade tensions between the US and China escalated, which could act as headwinds for the price of yellow metal. As per Reuters, US Commerce Secretary Gina Raimondo said no revision is expected on US tariffs which were imposed on China during Trump's administration, until the ongoing review by the US Treasury Office is completed.