WASHINGTON (dpa-AFX) - Gold traded slightly lower on Friday, after having surged above the $2,400 per ounce mark the previous day to reach its highest level since May 22.
Spot gold dipped 0.4 percent to $2,404.82 per ounce while U.S. gold futures were down half a percent at $2,409.70.
Bullion prices were set for a third weekly rise as surprisingly soft U.S. CPI data fueled bets for a September rate cut.
According to CME Group's FedWatch Tool, the chances a rate cut in September have jumped to 84.6 percent compared to 69.7 percent on Wednesday.
Traders were also reacting to comments from Federal Reserve officials.
San Francisco Fed president Mary Daly on Thursday said she expects further easing in both price pressures and the labor market, and therefore some policy adjustment will be warranted.
Chicago Fed President Austan Goolsbee described the latest inflation data as 'excellent,' adding the reports prove that the central bank is on track to meet its 2 percent target.
St. Louis Fed President Alberto Musalem also said cooler inflation data is 'encouraging' and the current level of the federal funds rate is 'the appropriate posture for policy at the current juncture'.
Trading later in the day may be impacted by data on U.S. producer price inflation along with a report on consumer sentiment, which includes readings on inflation expectations.
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