Gold futures on the COMEX division of the New York Mercantile Exchange fell more than 20 dollars on Monday as the strong U.S. dollar was further boosted amid financial turmoil triggered by a crashing Turkish lira.
The most active gold contract for December delivery went down 20.10 dollars, or 1.65 percent, to close at 1198.90 dollars per ounce, the first time that settled below 1200-dollar level since January 30, 2017.
The value of Turkish lira has lost some 30 percent against U.S. dollar since last Thursday amid rising diplomatic and trade tensions between the two traditional allies.
The sudden and sharp depreciation of Turkish lira has sent shock waves to the European and other world markets, which drove investors to the U.S. dollar, with expectations for further interest hikes later this year.
The precious metal gold, however, failed this time to act as a safe-haven asset.
The U.S. dollar index, a gauge of the greenback against a basket of key foreign currencies, rose 0.04 percent to 96.26 as 1641 GMT.
Gold and the dollar typically move in opposite directions. When the dollar goes up, gold futures will fall as gold, priced in the dollar, becomes expensive for investors using other currencies.
As for other precious metals, silver for September delivery fell 31.3 cents, or 2.05 percent, to close at 14.982 dollars per ounce. Platinum for October went down 30.10 dollars, or 3.63 percent, to settle at 799.50 dollars per ounce.