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Gold price (XAU/USD) declines to around $4,000 during the early Asian session on Tuesday. The precious metal edges lower as traders dialed back bets for further Federal Reserve (Fed) rate cuts. The Fed’s Michelle Bowman is scheduled to speak later in the day. 

The US central bank last week cut interest rates for the second time this year, but Fed Chair Jerome Powell said another cut this year was "not a foregone conclusion." The hawkish remarks from the Fed officials drag the yellow metal lower. The US central bank lowered its benchmark overnight borrowing rate at its October meeting last week to a range of 3.75%-4.0%.

The markets are discounting a 70% odds that the Fed will cut the fed funds target range by 25 basis points (bps) at the December meeting.  The markets are discounting an overall 82 bps rate reduction by the end of 2026 to 3.06% from the current effective federal funds rate of 3.88%.

However, the latest data showed the US manufacturing sector weakening last month. This, in turn, might weigh on the US Dollar (USD) and lift the USD-denominated commodity price. Data released by the Institute for Supply Management (ISM) on Monday showed that the US Manufacturing Purchasing Managers Index (PMI) fell to 48.7 in October from 49.1 in September. This figure came in weaker than the expectation of 49.5. 

Traders brace for the US October ADP Employment Change data later on Wednesday. This report might offer some hints about the chances of an additional Fed interest rate cut this year. In case of the weaker-than-expected outcome, this could provide some support to the safe-haven assets like the Gold price. 

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