Spot gold fell 0.7% to $4,345.76 per ounce as a firmer dollar and hawkish Federal Reserve rhetoric pressured bullion, while crude oil extended losses on supply outlooks.
Gold prices declined 0.7% as a stronger dollar and expectations of further Fed rate hikes reduced the metal's appeal.
Crude oil extended losses on expectations of increased supply and diplomatic efforts regarding Iran.
The US dollar index rose 0.1% to 100.30, contributing to downward pressure on gold prices.
Gold prices retreated on Monday as the US dollar index climbed 0.1% to 100.30, dampening demand for the precious metal. Investors are recalibrating portfolios following the Federal Reserve's recent rate hike, with markets pricing in an 88% probability of further tightening by December.
Gold is priced in US dollars; a stronger dollar makes the metal more expensive for foreign currency holders, which typically reduces demand and exerts downward pressure on prices.
Gold does not generate interest income. When interest rates rise, interest-bearing assets become more attractive to investors, decreasing the relative appeal of non-yielding assets like gold.