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Gold prices edged higher on Tuesday after comments from Federal Reserve officials reinforced expectations of bigger U.S. interest rate cuts later this year.

Spot gold was up 0.1% to $2,408.77 per ounce as of 0354 GMT. Bullion fell to its lowest since July 26 in the previous session, caught in a global sell-off driven by fears of a U.S. recession.

U.S. gold futures rose 0.2% to $2,449.50.

U.S. central bank policymakers pushed back against the notion that weaker-than-expected July jobs data means the economy is in a recessionary freefall, but also warned that the Fed will need to cut rates to avoid such an outcome.

Fed San Francisco President Mary Daly said her mind was open to cutting interest rates as necessary and policy needed to be proactive.

"If upcoming economic data out of U.S. comes out significantly weaker and the Fed becomes even more dovish, gold will move towards the $2,500 or beyond that," said ANZ commodity strategist Soni Kumari.

Traders will also be looking at data from top consumer China and with geopolitical tensions still running in the background, safe-haven demand should continue, she added.

Traders are now anticipating 110 basis points (bps) of easing this year from the Fed, with a 50 bps cut in September priced in at over 70% chance.

Lower rates put pressure on the dollar and bond yields, while increasing the appeal of non-yielding bullion. [USD/]

Meanwhile, Japanese stocks opened higher, underpinning a recovery across battered Asian share markets and even triggering circuit breakers in some. [MKTS/GLOB]

Data on Monday showed that the U.S. services sector activity rebounded from a four-year low in July amid a rise in orders and employment.

Spot silver fell 0.2% to $27.23 per ounce.

Platinum was up 1.2 to $917.30, while palladium rose 0.9% to $857.25 after hitting its lowest levels since August 2018 on Monday.