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Gold prices gained on Thursday, helped by a weaker U.S. dollar and Treasury yields, as investors waited for more U.S. data to gauge the outlook for interest rates after a key inflation report dampened hopes for a larger cut in September.

Spot gold was up 0.2% at $2,452.69 per ounce, as of 0547 GMT, after prices fell the most since Aug. 6 on Wednesday.

U.S. gold futures were up 0.4% at $2,490.10.

Both the U.S. dollar and benchmark 10-year Treasury yields were on the back foot after hitting their lowest in more than a week in the previous session.

The prospects of less aggressive interest rate cuts may have triggered some profit-taking in gold prices overnight, said IG market strategist Yeap Jun Rong.

"Prices are regaining some ground in the Asia session on some views that there may be some over-reaction in yesterday's downside move," Yeap said, adding that a new record high might be on the table for gold amid prospects of U.S. rate cuts, healthy central bank demand and geopolitical and economic risks.

Data on Wednesday showed that the U.S. consumer price index rose moderately in July and the annual increase in inflation slowed to below 3% for the first time since early 2021.

The data opened the door wider for the Federal Reserve to cut rates next month but a larger reduction is unlikely.

Traders now see about a 36% chance of a 50-basis-point rate cut in September, down from 50% before the data release, according to the CME FedWatch Tool.

A low interest rate environment tends to boost non-yielding bullion's appeal.

The market focus will be now on U.S. retail sales and initial jobless claims data, both due at 1230 GMT.

Among other metals, spot silver gained 0.4% to $27.7 per ounce, platinum rose 1.1% to $930.00 and palladium fell 0.6% to $929.75.