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Gold prices were subdued on Friday and headed for a weekly decline, while investors awaited further cues to gauge the size of a potential U.S. interest rate cut in September.

Spot gold was down 0.2% at $2,421.31 per ounce, as of 0402 GMT, after rising more than 1% on Thursday.

Bullion was on track for its biggest weekly fall since June 7, and fell as much as 3% on Monday after investors liquidated positions in tandem with a broader equities selloff.

U.S. gold futures dipped 0.1% to $2,460.80.

"Price activity for gold has been relatively steady today with investors taking a breather after a roller-coaster week," said Tim Waterer, chief market analyst, KCM Trade.

Federal Reserve policymakers are confident that cooling inflation will allow for future rate cuts, which will be guided by economic data rather than stock market fluctuations, according to three U.S. central bankers on Thursday.

"Fundamentally speaking, gold is poised to benefit from either increased risk aversion or from expectations of looser monetary conditions. There are multiple scenarios, which could play out in coming months, which could drive the gold price to fresh all-time highs," Waterer said.

Non-yielding bullion's appeal tends to shine in a low interest rate environment.

Markets see a 55% chance of a 50-basis-points cut in September, according to the CME FedWatch Tool, with an additional cut anticipated in December.

Meanwhile, data on Thursday showed U.S. jobless claims fell more than expected last week, suggesting fears the labour market is unravelling were overblown.

Investors' focus shifts to the U.S. consumer price index (CPI) and producer price index (PPI) due next week for further insights into the Fed's policy path.

Spot silver was up 0.3% at $27.66 per ounce and platinum rose 0.7% to $937.65. Both metals were poised for weekly losses.

Palladium gained 0.8% to $930.08 and was up 4.4% for the week.