After suffering severe losses in the previous session as traders shifted their focus to the dollar in anticipation of additional hints on U.S. interest rates, gold prices hung around the lowest level in three months on Wednesday.

Spot gold muted at $1,937.58 per ounce, meanwhile gold futures muted at $1,948.75 per ounce. Due to Tuesday's stronger-than-anticipated U.S. housing statistics, both instruments fell between 0.6% and 0.8%.

Later in the day, Federal Reserve Chair Jerome Powell is scheduled to appear before Congress and could provide additional hints regarding the direction of monetary policy and interest rates following the Fed's conflicting signals from the previous week.

Given that the Fed halted its rate hike cycle but hinted at possible further raises later in the year, uncertainty over the Fed triggered some flows into the dollar. As a result, gold prices had been pressured, mostly remaining within a narrow trading range witnessed during the previous month.