* Tehran downplays Israel's retaliatory attacks
* Investors gravitating back towards riskier assets
* PCE inflation data due out on Friday
April 22 (Reuters) - Gold prices fell more than 1% on Monday as easing fears of a wider Middle East conflict boosted investors' risk appetite, lowering bullion's safe-haven demand.
Spot gold was down 1.2% at $2,362.09 per ounce, as of 0929 GMT. U.S. gold futures fell 1.6% to $2,376.10.
Worries of ongoing tensions between Iran and Israel becoming an all-out war fading a little bit has stopped safe-haven trade that supported gold prices, said Ricardo Evangelista, senior analyst at ActivTrades.
Tehran downplayed Israel's retaliatory drone strike against Iran, in what appeared to be a move aimed at averting regional escalation.
Gold reached $2,417.59 per ounce in the previous session, approaching the April 12 record high of $2,431.29 as investors sought refuge in the metal's safe-haven, while global stocks plummeted.
Yet, as the new week began, equities regained some ground and oil prices, along with bonds, fell slightly, indicating a shift away from the defensive stance adopted by investors ahead of the weekend.
The U.S. personal consumption expenditures (PCE) report due on Friday may confirm prevailing fears of persistent inflation, potentially postponing interest rate cuts - a negative outlook for gold, noted Evangelista.
Progress on bringing down inflation has "stalled" this year, Fed's Austan Goolsbee said, echoing other Federal Reserve officials who believe that rates will need to stay high for longer to get price pressures under control again.
Looking ahead, Citi research anticipates gold and silver to surge in the second half of 2024, reaching $2,500 and $30-$32 per ounce, respectively, despite a possible temporary pullback before the end of the second quarter.
Spot silver fell 2.8% to $27.85 per ounce, platinum lost 0.5% to $926.85, and palladium was down 1.1% at $1,015.00.
(Reporting by Harshit Verma in Bengaluru; Editing by Varun H K)
