Gold prices dropped more than 2% to a one-week low on Monday as worries over a wider Middle East conflict subsided, prompting investors to scale back safe-haven trades in favour of riskier assets like equities.

Spot gold was down 2.5% at $2,330.51 per ounce as of 1:52 p.m. ET (1752 GMT), and marked its biggest intra-day fall in more than a year.Gold also came under pressure as Wall Street's main indexes opened higher, cutting demand for the safe-haven and non-interest paying asset.Geopolitical tensions coupled with robust central bank buying had driven gold to a record high of $2,431.29 on April 12.

Investors are now waiting for the release on Friday of the U.S. personal consumption expenditures (PCE) report for cues on the prospect of U.S. interest rate cuts.