After dropping from a six-week high in the previous session, gold prices continued to decline on Wednesday as fears over a domestic banking crisis lingered and a mixed figure on U.S. inflation bred some confusion about the Federal Reserve's stance on monetary policy.

Recent sessions saw a dramatic increase in the price of the yellow metal as investors rushed to conventional safe havens in response to the failure of numerous U.S. banks. Markets started pricing in a less hawkish Fed due to pressure on the banking sector and wagers that the central bank would try to stop more economic unrest.

Spot gold plunged by 0.1% to $1,902.18 per ounce, while gold futures slipped by 0.3% to $1,905.90 per ounce. The two main gauges dropped by 0.5% during the earlier session.

US consumer inflation dipped as anticipated in February, according to data released on Tuesday, but core inflation unexpectedly increased from January to retain pressure on the Fed to tighten policy.