Gold slipped on Monday as the U.S. dollar strengthened and precious metals prices remained within a tight range as investors awaited key U.S. data.
Spot gold lost 0.27 percent at $1,314.16 per ounce by 3:30 p.m. ET, erasing earlier gains after the U.S. dollar, in which it is priced, turned positive.
U.S. gold futures for June settled down $2.50 at $1,318.20.
The dollar rose on Monday, erasing earlier losses, as investors questioned whether a rally that last week sent the greenback to more than four-month highs had run out of steam.
"Gold is largely paying attention to the dollar," said John Caruso, senior market strategist at RJO Futures.
"We are seeing a lot of back and forth action with no news. Tomorrow with retail sales, everything could change," Caruso added.
U.S. retail sales growth would suggest a strengthening economy and give the Federal Reserve more reason to raise interest rates. Higher U.S. rates make gold a less attractive investment, because bullion does not offer interest. A U.S. interest rate hike, possibly in June at the Fed's next meeting, would weigh on gold, though analysts say that would be unlikely to push gold significantly lower.
"Over the short term, and particularly during May, we see gold trading between $1,285 and $1,338 an ounce as continued strength in the dollar and rising rates pressure values lower," said INTL FCStone analyst Edward Meir.
However, gold is expected to remain in this year's narrow range, mostly between $1,300 and $1,350, unless supply or demand fundamentals dramatically change.
"Gold's trading range in the first four months between low and high price was the lowest in percentage terms since it was fixed to the dollar in 1971," said Macquarie commodities strategist Matthew Turner.
Further bullion support could come from rising security risks in the Middle East after the United States said it would withdraw from the 2015 international nuclear deal with Iran and reimpose sanctions. Traders said falling gold imports by India, a top consumer, were also undermining sentiment.