SINGAPORE: Spot gold fell 0.2 percent to $4,170.63 an ounce, bringing its decline since the start of the month to more than 6 percent. US gold futures, meanwhile, rose 0.5 percent to $4,201.90.
Market sentiment was also affected by expectations surrounding US interest rates, while a stronger dollar put additional pressure on dollar-denominated precious metals by making them more expensive for holders of other currencies.
Investors are awaiting the release of the US Personal Consumption Expenditures (PCE) Price Index, a closely watched measure of inflation that could provide further clues about the Federal Reserve’s monetary policy outlook.
Higher interest rates typically weigh on gold’s appeal because the precious metal does not generate interest income.
According to the CME FedWatch tool, traders were pricing in a 47 percent probability of a Federal Reserve rate hike in October and a 91 percent probability of a rate hike in December. The US central bank raised interest rates by 25 basis points earlier this month.
Among other precious metals, silver fell 0.8 percent to $60.98 an ounce in spot trading, while platinum was little changed at $1,705.10.
Palladium declined 0.3 percent to $1,219.60.
Silver, platinum and palladium were also on course to record monthly declines.