Gold shed over 1% after vaulting above the $1,600 level for the first time in nearly seven years on Wednesday after remarks by US President Donald Trump eased fears of a larger conflict with Iran.
Spot gold dropped nearly 1% to $1,559.22 per ounce as of 1:32 p.m. ET (1834 GMT). Prices had earlier soared to $1,610.90 in the session, their highest level since March 2013. US gold futures settled 0.9% lower at $1,560.20.
Trump said Iranian missile strikes on bases in Iraq had not harmed any US troops, and that Tehran appeared to be standing down.
Earlier in the session gold jumped as much as 2.4% after Iran retaliated to a US drone strike that killed an Iranian military commander last week. The US attack led to fears of a new war in the Middle East.
"Expectations are that we're not going to see a war, so you might see some softness. The rest of the catalysts remain in place for gold," said Edward Moya, a senior market analyst at OANDA.
Investors also kept a close eye on economic data from the United States. Data showed US private payrolls surged in December, weighing on the metal. Meanwhile, palladium extended its rally, undaunted by most market events driving other precious metals. Prices were up 2.6% at $2,104.95, close to the all-time high of $2,108.81 notched earlier in the session. Platinum eased 1.4% to $957.02 an ounce, while silver shed 1.3% to $18.15. Silver prices had earlier notched a four-month high of $18.85.
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