Gold declined after comments from Fed officials about improves in the state of the US economy, to strengthen market confidence in raising interest rates this year.

The dollar rose after the Fed's Deputy Stanley Fischer said on Sunday that the US central bank is close to achieving its goal of full employment and two percent inflation.

The presidents of the Federal Reserve Bank of San Francisco and New York's John Williams and William Dudley also expressed confidence in the imminent rate increase.

Stocks of the largest gold exchange-traded fund iSPDR Gold Trust fell last week by 4.5 tonnes after a 20-tonne outflow of the previous week.

"The inflow of funds in the ETF stopped, and hedge funds cut long positions in five of the last six weeks - said the chief analyst of commodity markets at Saxo Bank, Ole Hansen - i think gold may weaken in the short term."

"Everyone will be watching the meeting in Jackson Hole as Fisher and Dudley reinforced expectations of a possible increase in interest rates.", - he added.

Representatives of central banks around the world will gather on Aug. 25 at the annual meeting in Jackson Hole, Wyoming, and Fed Chairman Janet Yellen will deliver a speech the next day.

The cost of the October futures on COMEX fell to $ 1331.60 per ounce.