- Fed officials, led by Chair Jerome Powell, have said repeatedly they expect price pressures to be transitory and monetary stimulus to stay in place for some time.
Gold prices inched lower on Thursday as a slight uptick in the dollar offset support from lower Treasury yields, while investors awaited key US economic readings this week for more clarity on monetary policy.
Spot gold was down 0.2% at $1,904.36 per ounce, as of 0316 GMT. On Tuesday, gold prices hit their highest level since Jan. 8 at $1,916.40.
US gold futures eased 0.1% to $1,907.70 per ounce.
The US Labor Department is expected to release initial weekly jobless claims data later on Thursday, followed by non-farm payroll numbers on Friday.
"We need to get a sense from the payrolls report on what is the immediate steer on Fed policy," DailyFX currency strategist Ilya Spivak said.
"Yields have eased back a bit since the start of the week. But the dollar is range-bound, it hasn't been able to build momentum and hasn't fallen off ... that has been reflected in gold."
The US 10-year Treasury yield slipped below 1.60%, reducing the opportunity cost of holding non-interest bearing gold.
The dollar index, however, edged 0.1% higher against its rivals, making gold less appealing for other currency holders.
The US economic recovery accelerated in recent weeks even as a long list of supply chain troubles, hiring difficulties, and rising prices cascaded through the country, Federal Reserve officials said on Wednesday.
Fed officials, led by Chair Jerome Powell, have said repeatedly they expect price pressures to be transitory and monetary stimulus to stay in place for some time.
SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, said its holdings fell 0.4% to 1,041.75 tonnes on Wednesday.
Elsewhere, silver edged 0.1% lower to $28.17 per ounce, palladium rose 0.1% to $2,858.46, while platinum was steady at $1,189.48.