Update: Gold (XAU/USD) remains sidelined above $1,800 as market players await monetary policy announcements from the European Central Bank (ECB) and the Bank of England (BOE) during early Thursday.

Although the metal drops for the first time in four days, retreating from the weekly top, as risk appetite weakens ahead of the key central bank events, the inability of the US Dollar Index (DXY) and the Treasury yields to cheer risk-off mood keep gold buyers hopeful.

That said, the stock futures and Asia-Pacific equities have been on the back foot since the day start as traders gear up for hawkish monetary plays amid inflation fears, recently cited by Fed Nominees from US President Joe Biden and US Treasury Secretary Janet Yellen. The reflation woes earlier got back-up from Eurozone as the headline HICP refreshed record top. On the same line is the UK’s upbeat inflation data which pushes Andrew Bailey and Company to announce a second rate hike.

Hence, today’s central bank moves will be crucial to watch for the near-term direction of gold prices. Additionally, US Q4 Nonfarm Productivity and Unit Labor Costs will join the January ISM Services PMI and Factory Orders for December to offer a busy day to the XAU/USD traders.

End of update.

At $1,808.20, gold is flat on the session so far and little changed over the course of the past few sessions holding above the key $1,800 per ounce level. However, there has been a focus on the US dollar and US Treasury yields that have both retreated after a disappointment in US jobs data.

Spot gold (XAU/USD) is solid on the basis that the greenback extended its losses to a more than a one-week low on Wednesday. In what might be considered as a bearish prelude to this Friday’s Nonfarm Payrolls, a dip in the US private sector employment for January due to the increase in COVID-19 infections has weighed on the US dollar. 

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