Gold fell early in the session when the dollar gained strength against the euro, recovered some losses later, but remained moderately lower even as the dollar fell to its lowest point against the euro this year. Silver also witnessed profit taking in line with other industrial metals.

IN FOCUS: South Africa's National Union of Mineworkers said on Monday its members at Anglo Platinum, the world's top platinum producer, had agreed to a one-year wage deal, averting a possible strike.

The world's largest gold-backed exchange-traded fund, the SPDR Gold Trust, said its holdings rose to 1,078.851 tonnes as of Sept. 14, up 1.221 tonnes from the previous business day.

Barrick Gold Corp, the world's largest producer, said on Monday it is carrying out a feasibility study on a promising copper deposit in Pakistan. Barrick, which announced last week it has dropped its hedging program with the gold price around $1,000 an ounce, expects to have more revenue and cash flow to fund new projects.

The dollar fell to its lowest level this year against the euro as a rebound in U. S. stocks revived risk appetite and reduced the greenback's safe-haven appeal. The dollar's early strength undermined metals across the board. But when the U. S. currency turned lower, precious metals investors were reluctant to push them back above recent long-term peaks.

On other markets, Wall Street opened lower and European stocks declined, with weaker macroeconomic data and a trade row between the United States and China weighing on buying interest.

Credit markets have eased a lot since last year's economic downturn and, with metal prices climbing, there is likely to be a wave of merger activity in the mining industry, U. S. Gold Corp Chief Executive Rob McEwen said on Monday.

FUNDAMENTAL OUTLOOK: Gold is holding on to the levels of $1000 per ounce. We expect it to trade sideways to up during the day backed by the weakness in the dollar. Silver futures are expected to bounce back in today's session after a downside in last sessions.