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Gold price (XAU/USD) extends the rally to around $4,140 during the early Asian session on Wednesday. The precious metal gains momentum on further bets of a rate cut by the US Federal Reserve (Fed) by year-end. Traders will keep an eye on the Fedspeak later on Wednesday. The Fed’s John Williams, Anna Paulson, Christopher Waller, Raphael Bostic, Stephen Miran and Susan Collins are scheduled to speak. 

The Automatic Data Processing (ADP) revealed on Tuesday that for the four weeks ended October 25, private sector job creation was down more than 11,250 on average per week. The data stands in contrast to the October gains that the firm reported last week, indicating some labor market weakening. Weaker-than-expected employment data from the ADP reignited speculation that the Fed could deliver additional easing, which supports the yellow metal.

Markets are currently priced in nearly a 68% chance of a 25 basis points (bps) rate cut by the Fed in December, with odds rising to about 80% by January, according to the CME FedWatch tool. Lower interest rates could reduce the opportunity cost of holding Gold, supporting the non-yielding precious metal.

Traders will closely monitor the developments surrounding a potential deal to end the US government shutdown. Signs that a resolution to the US government shutdown is nearing could undermine safe-haven assets like Gold. A record US government shutdown is on a path to end as soon as Wednesday after the Senate passed a temporary funding measure backed by a group of eight centrist Democrats, Bloomberg reported late Tuesday. The spending package would keep most of the government open through January 30. 

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