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% to $2,420.88 per ounce, as of 0653 GMT, after rising more than 1% on Thursday.

Bullion was on track for its biggest weekly decline since June 7. Prices 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 $2,460.10.

"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 believe cooling inflation will enable rate cuts, guided by economic data and not from stock-market turmoil.

"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.

Markets see a 55% chance of a 50-basis-point 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.

Investor 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.

Physical gold demand in India increased slightly this week due to a price correction, though market volatility led some buyers to delay purchases, while premiums in China rose on safe-haven buying.

Spot silver was down 0.1% to $27.54 per ounce and platinum rose 0.6% to $936.40. Both metals were poised for weekly losses.

Palladium gained 0.8% to $929.75 and was up over 4% for the week.

(Reporting by Daksh Grover in Bengaluru; Editing by Sherry Jacob-Phillips and Eileen Soreng)