Gold edged up to a two-week high and then retraced some gains on Monday, holding steady after Federal Reserve chair Janet Yellen said she still expected gradual U.S. rate increases.
On Monday, Yellen said interest rate hikes were likely because "positive economic forces have outweighed the negative" for the United States, though the weak jobs report bears watching. The precious metal had rallied 2.8 percent on Friday after surprisingly weak U.S. jobs data dampened expectations of rate hikes from the Fed.
"Chair Yellen's delicate dance of emphasizing the positives while acknowledging recent poor payrolls ... has kept gold and other markets largely unchanged, which may have been exactly the intention," said Tai Wong, director of base and precious metals trading for BMO Capital Markets in New York. "It keeps the July meeting in play and shifts focus into June's dot plot."