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Gold price (XAU/USD) tumbles to near $4,210 during the early Asian trading hours on Wednesday. The precious metal loses momentum as traders book profits ahead of the upcoming key US data releases. Traders brace for the release of the US ADP Employment Change and ISM Services PMI data later on Wednesday. 

The yellow metal has fallen around 0.65% on the day amid some profit-taking from the shorter-term futures traders and improved risk appetite in the general marketplace. Nonetheless, the potential downside might be limited on imminent bets for another rate cut by the Federal Reserve (Fed) this month.

"It's probably just a little bit of profit taking ... the market's biggest focus of late has been rate cut expectations, and those remain pretty steady," said Peter Grant, vice president and senior metals strategist at Zaner Metals.

Fed funds futures traders are now pricing in nearly an 89% chance of a rate cut at the conclusion of the Fed's December 9-10 meeting, up from 71% probability a week ago, according to the CME FedWatch Tool. Lower interest rates could reduce the opportunity cost of holding Gold, supporting the non-yielding precious metal.

Elsewhere, US envoy Steve Witkoff is set to meet Russian President Vladimir Putin this week to discuss a potential peace plan to end Russia’s war with Ukraine. Any signs of escalating tensions could boost the safe-haven asset like the Gold price, while optimism surrounding the peace deal could undermine the XAU/USD in the near term. 

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