Spot gold was down 0.1 percent to $1,202 per ounce by 0600 GMT, after dropping to as much as $1,197.31. The bullion hit an eight-week high of $1,218.64 on Tuesday.
• The dollar index, which measures the greenback against a basket of currencies, rose 0.3 percent to 101.230.
• With the U.S. economy close to full employment and inflation headed toward the Federal Reserve's 2 percent goal, it "makes sense" for the U.S. central bank to gradually lift interest rates, Fed Chair Janet Yellen said on Wednesday.
"(Yellen's) speech was interpreted as being bearish for gold," said INTL FCStone analyst Edward Meir, adding that the metal could be under more pressure later in the day as the Fed chair speaks on U.S. monetary policy again on Thursday.
• Dallas Fed President Robert Kaplan on Wednesday joined the chorus of central bank officials making a case for a gradual hike in U.S. interest rates.
• "We can still say there is an inverse relation between dollar and gold as we are waiting to hear from Trump on his policies. We can expect random shocks from him," said Mark To, head of research at Hong Kong's Wing Fung Financial Group.
"There should be some consolidation around the $1,200 levels for sometime."
• Silver fell 0.2 percent to $16.98 an ounce.
Reference: Reuters
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