On the Comex division of the New York Mercantile Exchange, gold futures for December delivery traded at USD1,313.90 during U.S. afternoon hours, down 1.26%.
Gold prices hit a session low of USD1,304.80 a troy ounce and high of USD1,330.70 a troy ounce.
Gold futures were likely to find support at USD1,272.10 a troy ounce, the low from Aug. 7, and resistance at USD1,416.30, Tuesday's high.
The December contract settled down 2.43% at USD1,330.60 a troy ounce on Thursday.
Despite soft U.S. data released earlier, consensus continued to build on Friday that the Federal Reserve will announce plans to taper its monthly USD85 billion asset-purchasing program at its Sept. 17-18 policy meeting.
The Thomson Reuters/University of Michigan preliminary U.S. consumer sentiment index fell to a six-month low of 76.8 in September from 82.1 in August, worse than expectations for a decline to 82.0.
Elsewhere, official data showed that U.S. retail sales rose 0.2% in August, missing expectations for a 0.4% rise after an upwardly revised 0.4% increase the previous month.
Core retail sales, excluding automobiles, rose 0.1% last month, short of expectations for a 0.3% gain after an upwardly revised 0.6% increase in July.
A separate report showed that the U.S. producer price index rose 0.3% in August, more than the expected 0.2% after a flat reading the previous month, which kept expectations alive the Fed will begin buying less bonds to stimulate the U.S. .
Core producer price inflation, excluding food and energy, was flat last month, compared to expectations for a 0.1% rise, after a 0.1% gain in July.
The day's data, while disappointing for some, still painted a picture of an improving U.S. economy and one in need of less Fed support.
Monetary stimulus programs such as Fed asset purchases weaken the dollar to spur recovery, which makes gold an attractive hedge.
Elsewhere, U.S. Secretary of State John Kerry and Russian Foreign Minister Sergei Lavrov held a fresh round of talks on Friday to discuss ways to disarm Syria of its chemical weapons, and while the U.S. says military action is still possible, metals markets concluded such campaigns are less likely.
Syria has agreed to hand over its chemical weapons cache to international control at Russia's request.
Gold served as a safe-haven asset class during the U.S.-Syrian crisis, though prices have fallen as the prospects of U.S. military strikes have declined.
Elsewhere on the Comex, silver for December delivery was down 1.52% at USD21.813 a troy ounce, while copper for December delivery was down 0.24% and trading at USD3.202 a pound.