Gold down ahead of Fed meeting

Gold futures on the COMEX division of the New York Mercantile Exchange fell on Monday as investors awaited the US Federal Reserve's decision on whether to raise the interest rate.

The most active gold contract for February delivery fell $12.3, or 1.14 percent, to settle at $1,063.40 per ounce, Xinhua reported.

The Federal Open Market Committee (FOMC) is scheduled to meet on Wednesday to determine whether or not to raise interest rates.

Analysts believed that the market has now fully factored in the expected December rate hike, and that the market is now unsure of when the next rate hike, from a 0.50 rate to a 0.75 rate will occur.

According to the CME Group's Fedwatch tool, the implied probability of a rate hike on Wednesday is 83 percent.

An increase in the Fed's interest rate drives investors away from gold and toward 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 US financial crisis.

The strong US dollar also added some pressure to gold on Monday.

As for other metals, silver for March delivery fell 18.9 cents, or 1.36 percent, to close at $13.695 per ounce.

Platinum for January delivery rose $6.5, or 0.77 percent, to close at $850.20 per ounce.