Gold prices edged lower during Friday's Asian session, reversing a brief rebound from the previous day as renewed demand for the United States dollar weighed on the precious metal and left it on track for a fourth consecutive weekly decline.
By 3:50 pm AEST (5:50 am GMT), spot gold was down 0.2% at US$4,012.48 per ounce.
Gold continued to struggle to hold above the US$4,000 level as investors shifted back into the U.S. dollar amid a deterioration in broader market sentiment.
Risk aversion intensified across Asian markets following a technology-led sell-off on Wall Street overnight, where investors reacted to price increases announced by several major technology companies.
Apple led the decline after raising prices on iPads and MacBooks, citing higher component costs.
Investor caution was also fuelled by renewed tensions in the Strait of Hormuz following an attack on a cargo vessel off the coast of Oman.
The vessel was reportedly damaged by an unidentified projectile, prompting renewed concerns over shipping security in the strategic waterway.
A White House official said the United States was investigating who was responsible for the strike, including whether it had been authorised by senior members of Iran's Islamic Revolutionary Guard Corps (IRGC) or carried out independently by lower-ranking personnel.
Gold had briefly recovered on Thursday after falling to a seven-month low of $3,959, with the rebound driven by short-covering after the release of the Federal Reserve's preferred inflation measure.
The core Personal Consumption Expenditures (PCE) Price Index for May was largely in-line with market expectations, prompting traders to reduce expectations for at least two U.S. interest rate increases this year.
The inflation data weakened the U.S. dollar during Thursday's session and allowed gold to stage a modest recovery. However, the rebound proved short-lived as geopolitical risks and renewed demand for the greenback re-emerged ahead of the weekend.
