1st LD Writethru: Gold down on U.S. Fed hints

Gold futures fell on the COMEX division of the New York Mercantile Exchange Monday as the U.S. Federal Reserve hinted that the U.S. interest rate could be increased before the end of the year.

The most active gold contract for December delivery fell 1.5 U.S. dollars, or 0.13 percent, to settle at 1,132.50 dollars per ounce.

The precious metal was put under pressure as the U.S. central bank hinted during a conference at Jackson Hole, Wyoming that despite a recent trend of less than ideal U.S. economic data, they would still consider raising the U.S. interest rate before the end of 2015. An increase in the Fed's interest rate drives investors away from gold and towards assets with a return, as the precious metal bears no interest. There has not been an increase in the Fed's interest rate since June 2006, before the beginning of the American financial crisis.

Gold was given slight support as the U.S. Dollar Index fell to 95.88 as of 1830 GMT. The index is a measure of the dollar against a basket of major currencies. Gold and the dollar typically move in opposite directions, which means if the dollar goes up, gold futures will fall as gold, measured by the dollar, becomes more expensive for investors.

Silver for December delivery rose 3.7 cents, or 0.25 percent, to close at 14.586 dollars per ounce. Platinum for October delivery fell 11.2 dollars, or 1.10 percent, to close at 1,010.50 dollars per ounce. Endit