Gold prices reversed earlier gains on Friday as hawkish comments from US Federal Reserve officials clouded prospects for a December rate cut, although they remained set for a weekly gain supported by wider economic uncertainty.
Spot gold fell 0.6% to $4,145.49 per ounce, as of 1153 GMT, after hitting $4,211.06 earlier in the session. Bullion is up 3.7% so far this week.
US gold futures for December delivery fell 1.1% to $4,149 per ounce, Reuters reported.
"Gold prices are receiving support from the cautious mood that has set in across financial markets... however, the upside remains limited by growing doubts about a Federal Reserve rate cut in December, given the lack of fresh economic data," said ActivTrades analyst Ricardo Evangelista.
The US government reopened after a record 43-day shutdown that had disrupted key economic data flows. The White House, however, tempered hopes for clarity on the economy, stating that October's unemployment data may not become available.
"Gold may also be facing pressure from position closing to meet margin calls triggered by declines in equity markets," Evangelista said.
Equity markets tumbled on Friday, following the global selloff triggered by hawkish Fed signals.
Weighing on rate-cut expectations, some Federal Reserve officials have cited inflation concerns and relative labor market stability following two rate cuts earlier this year.
According to CME Group's FedWatch tool, traders now see a 49% probability of a quarter-point rate cut in December, down from 64% earlier this week.
Alex Ebkarian, COO at Allegiance Gold, however, noted that "as the shutdown cost becomes clearer and more spending unfolds, the inflation plus growth uncertainty regime favours precious metals".
Non-yielding gold tends to perform well during periods of economic uncertainty and in low-interest-rate environment.
Meanwhile, physical gold demand across major Asian markets was subdued this week as elevated prices curtailed buying activity, with discounts in India reaching their highest level in five months.
Elsewhere, spot silver edged down 0.1% to $52.26 per ounce and was on track for a weekly gain, up 7.8% so far.
Platinum fell 2% to $1,548.80 on Friday and palladium lost 1.7% to $1,402.75.
