Gold down on hawkish Fed expectations

Gold futures on the COMEX division of the New York Mercantile Exchange fell on Monday, pressured by expectations that a speech from U.S. Federal Reserve Chairwoman Janet Yellen later this week will support an interest-rate hike as soon as September, fueling a rise in the dollar.

Fed members are set to converge on Jackson Hole of Wyoming near the end of the week for an annual policy retreat. Investors will parse Yellen's speech Friday for clues on the near-term fate of interest rates. The debate over the odds, however slim, for a typically gold-negative rate hike yet this year continue to intensify in the lead-up to the market-sensitive event.

The most active gold contract for December delivery fell 2.8 U.S. dollars, or 0.21 percent, to settle at 1,343.4 dollars per ounce.

Gold was put under pressure as a report released by the Chicago Federal Reserve on Monday showed its National Activity Index increasing to 0.27 points during the math of July, a figure that was stronger-than-expected. Analysts note that strength in this measure comes in the wake of a strong employment report and strong industrial production.

But U.S. equities gave support to the precious metal as the U.S. Dow Jones Industrial Average fell by 10 points, or 0.06 percent as of 1715 GMT. Analysts note that when equities post losses, the precious metal usually goes up, as investors are looking for a safe haven, while the opposite is true when U.S. equities post gains.

Silver for September delivery fell 45.8 cents, or 2.37 percent, to close at 18.859 dollars per ounce. Platinum for October delivery dropped 10.2 dollars, or 0.91 percent, to close at 1,108.2 dollars per ounce. Endit