Powell said this could mean slower growth, a weaker labor market and “some pain” for households and businesses, but he did not hint at what the Fed might do at its next policy meeting in September.
Spot gold fell 1.25% to $1,736.49 per ounce, marking a second consecutive week of decline, and US gold futures fell 1.26% to $1,749.
Gold is a hedge against economic risks, but higher interest rates have affected the attractiveness of non-yielding assets.
US 2-year Treasury yields briefly rose to their highest since October 2007 before settling near two-month highs, while the dollar rebounded from an initial decline.
Physical gold premiums in China jumped this week to their highest level since last October, while demand in India fell.
Spot silver fell 2.22% to $18.852 an ounce, platinum fell 2.06% to $862.8415, and palladium fell 1.72% to $2110.0762.