Gold prices slipped on Tuesday as the dollar steadied, while investors braced for U.S. inflation data later this week that could determine the Federal Reserve's policy path.
Spot gold fell 0.2% to $1,670.64 per ounce by 1228 GMT, after hitting a three-week peak on Monday.
U.S. gold futures shed 0.4% to $1,673.30.
"The U.S. dollar's quest to retain lost ground is prompting a pause in gold following the latter's surge post jobs data," said Han Tan, chief market analyst at Exinity.
The dollar index steadied after hitting a more than one-week low on Monday, dimming bullion's appeal for overseas buyers.
Data on Friday showed the U.S. unemployment rate in October rose to 3.7%, raising hopes the Fed would shift to less aggressive interest rate hikes and helping gold record its best day since March 2020.
Investors will now keep a close watch on the U.S. inflation print on Thursday, and also Tuesday's midterm elections.
Evidence of persistently elevated inflation that heralds more incoming rate hikes is likely to unwind some of gold's recent gains, Tan said, adding that gold should catch a strong bid along with other safe havens if election results are unclear.
Although gold is seen as an inflation hedge, higher interest rates raise the opportunity cost of holding bullion.
Still, it is holding onto the bulk of the gains from late last week quite well, OANDA analyst Craig Erlam said. That suggests that traders are anticipating some good news from the CPI data, at least good enough to convince the Fed to ease its tightening pace, he added.
Meanwhile, two top policymakers at the European Central Bank said it will continue to raise borrowing costs even as the euro zone economy suffers.
Market participants also kept a close tab on any news surrounding COVID-related curbs in top bullion consumer China.
Spot silver fell 0.5% to $20.67 per ounce, platinum eased 0.1% to $978, and palladium dropped 0.8% to $1,881.50.
(Reporting by Arundhati Sarkar in Bengaluru; Editing by Janane Venkatraman and Vinay Dwivedi)