Gold hits 3-1/2 month low on firmer dollar after Yellen comments

Gold fell below $1,200 for the first time since mid-February on Monday, as comments from Federal Reserve Chief Janet Yellen on the likelihood of higher U.S. interest rates sent the dollar to two-month highs.

The Fed should increase interest rates in the coming months if the economy picks up, Yellen said on Friday, bolstering the case for a rate hike in June or July. St. Louis Fed President James Bullard said on Monday global markets appeared to be “well-prepared” for a summer rate hike.

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