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Gold edged lower on Wednesday after strong U.S. inflation data dampened speculation of near-term interest rate cuts, with investors also focused on an upcoming meeting between U.S. President Donald Trump and Chinese counterpart Xi Jinping.
Spot gold was down 0.4% to $4,694.59 per ounce at 0946 GMT, retreating from a three-week high hit in the last session. U.S. gold futures for June delivery gained 0.3% to $4,702.40.
The dollar hit a more than one-week high, making dollar-priced bullion expensive for holders of other currencies.
U.S. consumer inflation rose further in April, with the annual rate posting its largest gain in three years, as higher oil prices triggered by the U.S.-Israeli war on Iran pushed costs up, data on Tuesday showed.
"Yesterday's higher inflation data is expected to keep the Federal Reserve on hold longer, but still with easing bias. That is likely to keep (gold) trending sideways in the short term," said UBS analyst Giovanni Staunovo.
"In general U.S. economic data will influence gold, if we see some growth slowdown that should support the yellow metal."
Investors are now awaiting U.S. producer price inflation data for April, due later in the day.
The Middle East conflict remained at an impasse after Trump said on Tuesday he did not expect to need China's help to end the war with Iran, ahead of his meeting with Xi later this week.
Gold has fallen more than 10% since the Iran war began late February, as elevated oil prices fuelled concerns about inflation and higher-for-longer interest rates.
While gold is seen as a hedge against inflation, high rates tend to weigh on the non-yielding asset.
Traders have largely priced out a U.S. rate cut this year and now see a 29% chance of a hike in December, according to CME Group's FedWatch tool.
Spot silver fell 0.1% to $86.61 per ounce, after hitting its highest level since March 11 earlier in the session. Platinum slid 0.1% to $2,123.80, and palladium was down 0.1% at $1,489.18.
(Reporting by Noel John in Bengaluru. Editing by Mark Potter)
