Gold fell on Friday, following its biggest one-day percentage loss in a month in the previous session, on a firmer dollar and increased investor appetite for riskier assets due to strong U.S. data and corporate results.
Spot gold fell 0.1% to $1,285.01 per ounce as of 0311 GMT.
U.S. gold futures was 0.1% lower at $1,285.20 an ounce.
Spot gold fell 0.8% on Thursday, its biggest one-day percentage decline in a month after risk sentiment improved.
"Markets are very much inclined towards the riskier assets. Investors are trying to price in breakthrough in talks due to the conciliatory tone from both the camps," said Benjamin Lu, analyst with Singapore-based Phillip Futures
"Strong corporate earnings have also helped to give some support to equities and dollar. Most of the managed-money managers are trying to take out profits, which is pressuring gold."
U.S. stock indexes extended gains on upbeat earnings as well as robust economic data that underlined the strength of the domestic economy. Meanwhile, the dollar index rose to its highest level in nearly two weeks against a basket of currencies.
The U.S. housing data showed homebuilding increased more than expected in April, while unemployment benefits fell more than expected last week, pointing to sustained labour market strength that should underpin the economy.
"We still see broad strength in the overall global economy, which is currently benefiting from more fiscal and monetary stimulus," Fitch Solutions said in a note, adding that this limits significant gold price appreciation in 2019.
The pullback in risk aversion lifted treasury yields. The rise in yields underpinned the U.S. dollar.
A stronger dollar makes gold more expensive for holders of non-U.S. currency. Early in the week, spot gold prices rose 1.1%, registering their best one-day percentage gain in nearly three months after China announced that it would impose retaliatory tariffs on a range of U.S. goods.
Even though trade worries have taken a backseat, investors are still wary of possible tensions emanating from a U.S. bid to block China's Huawei Technologies from buying vital American technology.
Among other metals, silver was down 0.2% at $14.52 and ounce, after hitting a low since Dec. 14, 2018 at $14.46 an ounce.
Platinum dipped 0.6% to $824.83 per ounce, having hit a two-month low at $823.50 earlier in the session.
Palladium was down 0.1% at $1,329.35 per ounce and has slumped more than 18% since the metal used in catalytic converters in car exhaust systems scaled a record peak of $1,620.53 in March.