Gold slips on profit taking, firmer dollar

Gold prices fell on Monday on a firmer dollar and as investors booked profits after bullion recorded its best quarter in a year on Friday.

Spot gold was 0.23 percent lower at $1,245.71 per ounce at 1057 GMT, while US gold futures were down 0.3 percent at $1,247.5.

The dollar index strengthened 0.25 percent against a basket of major currencies, pulling away from four-month lows plumbed last week.

"Gold is stuck between $1,238-$1,260 with the risk to skewed to downside based on rising expected interest rates and failure to break higher which has left it vulnerable to profit-taking in the short term," said Ole Hansen, the head of commodity strategy at Saxo Bank.

A Federal Reserve official said on Friday the Fed could pause interest rate hikes when it begins shedding its bond holdings, a move that could benefit gold.

Gold is highly exposed to interest rates as they lift the opportunity cost of holding non-yielding bullion.