Gold recovered late Monday after sliding in response to Robert Kaplan's comments. With it's late-day moves, the precious metal rose to settle at a 3-1/2 month high.
Kaplan, a voting member on The Fed's policymaking committee, reiterated his view that a rate hike should come sooner rather than later.
The Fed is scheduled to hold its next monetary policy meeting March 14, with the possibility of a rate hike high enough to keep investors intrigued. Market expectations for a rate hike in March are around 50 percent, according to Fed funds futures.
Investors area also waiting on details of President Donald Trump's policy, which he should revel to Congress when he addresses them Tuesday.
"What he reveals might be important for gold. For example, if he announces significant fiscal easing, that would raise inflation expectations and lead investors into gold," said Danske Bank analyst Jens Pederson.
"But the border adjustment tax (import tax) could push the dollar higher and that could be negative for gold ... The whole area of foreign policy may mean more political uncertainty and that's positive for gold."