Gold prices fell below US$4,600 during Asian trading on Friday, extending a corrective decline from a 15-week high reached earlier this week as the United States dollar maintained its recovery.
By 4:10 pm AEST (6:10 am GMT), spot gold was trading 0.5% lower at US$4,579.89 an ounce.
Investors are now awaiting Federal Reserve Chair Kevin Warsh's debut at the annual Jackson Hole Symposium, with his speech expected to provide clues on the outlook for U.S. interest rates.
Markets will closely scrutinise Warsh's remarks for indications of whether an interest-rate hike remains a possibility at the Fed's 16-17 September monetary policy meeting.
Despite hotter-than-expected U.S. core Personal Consumption Expenditures (PCE) price data for July, the CME Group FedWatch Tool showed markets were pricing in about a 66.3% probability that the Fed will leave rates unchanged next month.
The headline PCE price index rose 0.2% in July, taking the annual inflation rate to 3.7%, according to data released by the Commerce Department on Wednesday.
Markets had expected monthly growth of 0.1% and an annual rate of 3.6%.
Core PCE increased 0.2% for the month and 3.3% annually, in line with expectations.
Reduced expectations for a September rate hike and optimism surrounding a potential reopening of the Strait of Hormuz have limited the U.S. dollar's recovery, helping to cushion gold from further losses.
However, the precious metal's next major move is likely to depend on Warsh's remarks, with investors looking for a clearer roadmap on how the new Fed chair intends to combat inflation while balancing incoming economic data and the goal of restoring price stability.
