Spot gold was down 0.1% at $1,776.71 per ounce by 0711 GMT. U.S. gold futures were steady at $1,775.90.
“A stronger dollar and Treasury Secretary Yellen’s rate-hike comments overnight continue to weigh on sentiment in Asia, with multiple failures ahead of the $1,800 an ounce region,” OANDA senior market analyst Jeffrey Halley said.
The dollar index turned positive and was hovering close to a near two-week peak against its rivals.
Yellen on Tuesday said she sees no inflation problem brewing, downplaying earlier comments that rate hikes may be needed to stop the economy overheating as U.S. President Joe Biden’s spending plans boost growth.
Higher interest rates dull gold’s appeal as it increases the opportunity cost of holding non-yielding bullion.
Investor focus is expected to shift to April payrolls data due on Friday for further cues on the health of the U.S. economy.
So far, Federal Reserve Chair Jerome Powell has argued the labour market is still far short of where it needs to be to start discussing tapering asset buying.
Elsewhere, palladium rose 0.5% to $2,999.49 per ounce after hitting an all-time high of $3,017.18 in the previous session, driven by concerns of a shortage of the metal.
“Rallies in palladium and platinum are being driven by disrupted or limited supply of both metals meeting a huge jump in demand by car manufacturers,” Halley said.
Palladium, used mainly in emission-reducing auto catalysts for vehicles, has risen more than 22% so far this year.
Silver was down 0.8% at $26.33, while platinum eased 0.9% to $1,227.02 after hitting its highest level in more than two months on Tuesday. (Reporting by Shreyansi Singh and Brijesh Patel in Bengaluru; Editing by Rashmi Aich and Sherry Jacob-Phillips)