Also weighing on gold were firmer stock markets, including Britain's FTSE 100, which rose more than 1 percent, partly helped by the drop in sterling, as a weaker pound typically benefits the FTSE's export-driven, internationally focused companies.
Reports that Deutsche Bank was negotiating a reduced settlement with the U.S. Department of Justice also boosted risk appetite among investors.
Analysts will look to U.S. non farm payrolls report on Friday to provide more clarity on whether the U.S. Federal Reserve is on track to raise interest rates by the end of this year.
Gold is highly sensitive to rising U.S. interest rates, as these increase the opportunity cost of holding non-yielding bullion, while boosting the dollar and making commodities more expensive for non-U.S.-firms.
Platinum was the only precious metal that was trading lower on Monday after South Africa's biggest platinum mine-workers' union signed a two-year wage agreement with Impala Platinum.
Silver rose 0.44 percent to $19.24 an ounce, platinum slipped 0.51 percent to $1,018.49, and palladium was up 0.35 percent at $722.