Gold slid to $1,239.80 (-0.64%) after jumping to a one-year high in the previous session. Turmoil in stock markets across the globe boosts demand for safe-haven assets. Some analysts say that investors don't believe central banks can fix the situation.

Comments made by Federal Reserve Chairwoman Janet Yellen on Thursday further decreased expectations of a rate hike in the near future. Although Yellen suggested that the Fed plans to continue raising rates, market participants took her comments as a "no".

Holdings of SPDR Gold Trust, the largest gold-backed exchange-traded-fund, rose by 2% on Thursday marking the biggest inflow in two months.