America News Agency

Spot gold advanced 0.5 percent to $2,506.00 per ounce. U.S. gold futures firmed 0.4 percent to $2,536.10.

Non-yielding bullion tends to perform well when interest rates are low. It is also considered a hedge against economic and political uncertainties.

Data overnight showed that U.S. job openings dropped to a 3-1/2-year low in July, but the reduction on its own is possibly not enough to warrant a half-percentage-point rate cut by the Fed.

Traders raised the odds of a 50-basis-point cut to 45 percent from 38 percent, while focusing on non-farm payrolls (NFP) report due on Friday. San Francisco Fed President Mary Daly said rate cuts were needed to keep the labour market healthy. "As inflation falls, we've got a real rate of interest that's rising into a slowing economy; that's a basic recipe for over-tightening," she said.

Investors are also monitoring the ADP employment report, a reading on the U.S. services industry, and jobless claims data due later in the day. “Central banks appear to be key drivers of gold demand over recent quarters,” according to the analysts.