Gold prices fell markedly, being at the same time near the lowest level in nearly four weeks, due to statements made by the Federal Reserve Janet Yellen before the U.S. Congress. During his speech, Yellen said that the Fed should continue implementation of accommodative monetary policy. "Although the economic situation continues to improve, the recovery is not yet complete," - she said. In particular, Yellen noted weakness of the U.S. labor market. She also once again emphasized that the economic forecasts involve substantial uncertainty, and the Fed's decision on interest rates will depend on the macroeconomic data. According to the head of the Fed, the U.S. Central Bank may raise interest rates sooner than the market expects. Much will depend on the pace of recovery. "If the situation on the labor market will improve faster than the Fed suggests that lead to more rapid progress toward our dual objectives, the target of increasing the rate on federal credit facilities may occur earlier and go faster than currently expected," - Yellen said.

Meanwhile, traders note that increasing the risk of further decline, especially given the price fall below $ 1,305. Concerned that even after the price reduction at $ 30 physical demand has not grown substantially, it can also increase the pressure on prices. We add that the quotes in the Chinese market, the world's largest consumer of gold, below the world price, which is a sign of weak demand in the physical market.

The attention of investors is also drawn to the unstable situation in the Middle East and Ukraine. Problems leading financial institutions in Portugal have temporary support of precious metals, which acts traditional safe haven.

Little impact on today's trading also had U.S. data that showed retail sales rose a seasonally adjusted 0.2% in June compared with the previous month, showing the weakest growth since January. This was stated by the Ministry of Commerce on Tuesday. Consumers stepped up spending on clothing, general merchandise and health foods, but cut spending on big ticket items such as furniture and cars. Excluding autos, sales rose 0.4%. Economists had forecast a 0.6% increase in total retail sales and an increase in sales excluding autos 0.5%.

Meanwhile, it was reported that the world's largest reserves secured gold exchange-traded fund SPDR Gold Trust on Monday rose by 8.68 tonnes to 808.73 tonnes.

The cost of the August gold futures on the COMEX today dropped to $ 1294.00 per ounce.