Update prices
Spot gold rose 0.2 percent to $2,452.69 per ounce by 0547 GMT, after prices posted their biggest drop since Aug. 6 on Wednesday.
U.S. gold futures rose 0.4 percent to $2,490.10.
The dollar and benchmark 10-year Treasury yields fell after each hit its lowest level in more than a week in the previous session.
The prospect of a smaller rate cut may have led to some profit-taking in the gold market overnight, said IG analyst Yip Jun Rong.
Data on Wednesday showed that the US consumer price index rose slightly in July and that the annual increase in inflation slowed to less than 3% for the first time since early 2021.
The data opened the door for the Federal Reserve to cut interest rates next month, but a bigger cut is unlikely.
Markets are now betting about 36 percent on the Fed cutting rates by 50 basis points in September, compared with 50 percent before the CPI data, according to the CME Group’s FedWatch tool.
Lower interest rates would boost the appeal of non-yielding gold.
As for other precious metals, silver rose in spot transactions by 0.4 percent to $27.7 per ounce, platinum rose by 1.1 percent to $930, while palladium fell by 0.6 percent to $929.75 per ounce.
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