Federal Reserve officials on Friday said they want to see more details about new tariff policies before deciding whether any policy response is warranted, holding to their view that more interest rate hikes are needed.
Stocks rallied after the announcement. A stronger dollar makes dollar-priced gold costlier for holders of other currencies. Yields had risen earlier in the afternoon.
Newly-installed Fed Chairman Jerome Powell pointed to factors that have boosted the economic outlook in recent months, including "more stimulative" fiscal policy, in the wake of the massive tax cuts Congress passed in December.
Policymakers also signalled they would increase rates twice more this year, while raising the forecast for rate hikes in 2019.
"So we're trying to take that middle ground, and the committee continues to believe that the middle ground consists of further gradual increases in the federal funds rate, as long as the economy is broadly on its path", Powell said.
"Considering that the Fed just hiked interest rates for the sixth time in this tightening cycle and revised up its rate expectations for 2019, the price of gold is faring quite well", she added.
"This is by all means a "hopeful" Fed that's shifting away from the data-dependent approach that Janet Yellen got us used to".
Small and mid-size companies climbed.
Higher base metal prices helped lift miners, with heavyweights BHP Billiton and Rio Tinto climbing 2-3 percent.
The S&P 500 index slid 5.01 points, or 0.2 percent, to 2,711.93.
Britain's FTSE 100 dropped 0.6 percent to 6,999.86 and Germany's DAX lost 0.9 percent to 12,193.57.
That's good news for retirees, who can look forward to higher returns on their savings - something that's been unattainable in recent years, with most banks paying interest of well below 2 percent. The vote to increase the rate Wednesday was a unanimous 8-0.
Bond prices edged lower.
Two-year US yields slipped to 2.304 percent from 9 1/2-year high of 2.366 percent. The 2019 estimate rose to 2.4% from 2.1%.
David Kelly, the chief global strategist for JPMorgan Asset Management, said stocks usually do well when rates are rising, but only up to a point. The move places U.S. interest rates in a band from 1.5 to 1.75% which is still very low by historic standards.
A healthy job market and a steady if unspectacular economy have given the Fed the confidence to think the economy can withstand further increases within a still historically low range of borrowing rates.
But when asked about the Fed's growth estimates and the tax cuts, Powell downplayed them. Some of the biggest gains went to Marathon Oil and Anadarko Petroleum.
That weighed on other food companies, with Kellogg off 3.98 percent, JM Smucker down 4.20 percent and ConAgra off 2.94 percent.
Thailand's benchmark index yesterday fell 2.88 points to 1,798.55 at the close of trading.
U.S. West Texas Intermediate (WTI) crude futures rose to as high as $65.74 per barrel, not far from its January peak of $66.66, having gained nearly five percent so far this week.
The dollar fell to 106.10 yen from 106.46 yen. The euro gained to $1.2269 from $1.2241.
Facebook shares gained 0.74 percent to stem its recent sell-off over the past two days, which cost the social media company about United States dollars 50 billion in market value after reports of data misuse that raised broader questions about consumer privacy and the need for tougher regulation.