Spot gold rose 0.1% to $1,816.08 per ounce by 12:23 pm EDT (1623 GMT), having hit a session low of $1,804.49, while U.S. gold futures were also up 0.1% at $1,811.30.
Restoring some of gold's appeal, the dollar index fell 0.1% against its rivals and benchmark U.S. 10-year Treasury yields dropped to a near two-week low. [USD/] [US/]
"The dollar and yields are a little lower which are supporting prices. If both remain low, I suspect gold may see some support once more," OANDA analyst Craig Erlam said.
Erlam also said the metal may have ran into resistance around the $1,830 mark, which could have triggered some profit- taking, prompting the metal to back off from last week's highs.
The precious metal has shed 0.9% from the two-week peak that it scaled on Thursday after U.S. Federal Reserve Chair Jerome Powell said the job market still had "some ground to cover" before it could pull back its support to the economy.
"There's a slight lesser need for safe havens as the equity markets are surging higher once again," said David Meger, director of metals trading at High Ridge Futures, adding U.S. jobs data later this week will be a key event risk.
"However, the underlying premises post (the) Federal Reserve meeting is an environment that is conducive to the yellow metal moving forward."
Focus now shifts to July's U.S. non-farm payroll numbers, due on Friday, expected to shed more light on the health of the labour market.
Elsewhere, silver fell 0.1% to $25.42 per ounce, palladium gained 0.7% to $2,678.64, and platinum rose 0.9% to $1,058.48.
(Reporting by Brijesh Patel in Bengaluru; Editing by Alistair Bell and David Holmes)
By Brijesh Patel