Investing.com - Gold futures were under pressure in European trade on Monday, retreating further from last week’s 22-month high as fears over a potential U.K. exit from the European Union temporarily eased.
Concerns over a possible Brexit subsided after a series of weekend polls showed the campaign to keep Britain in the EU had regained momentum ahead of Thursday's highly-anticipated referendum.
Gold for August delivery on the Comex division of the New York Mercantile Exchange fell to an intraday low of $1,282.30 a troy ounce. It last traded at $1,286.55 by 06:43GMT, or 2:43AM ET, down $8.25, or 0.64%.
Gold soared to $1,318.90 late last week, the most since August 2014, as worries about a potential exit by the U.K. from the European Union left investors scrambling for safe haven assets.
Prior to the Brexit referendum, Federal Reserve Chair Janet Yellen’s monetary policy testimony in Congress on Tuesday and Wednesday will attract the markets’ attention.
Yellen is scheduled to testify on the economy before the Senate Banking Committee on Tuesday. On Wednesday, Yellen will appear in front the House Financial Services Committee.
Little news is expected from the Fed chair, after the U.S. central bank released updated forecasts on the economy and interest rates following last week’s policy meeting.
Market players are pricing in a 7% chance for a rate hike in July and 24% for September, according to CME Group's (NASDAQ:CME) FedWatch tool.
The yellow metal is sensitive to moves in U.S. interest rates. A gradual path to higher rates is seen as less of a threat to gold prices than a swift series of increases.
Prices of the precious metal are up nearly 7% so far in June, as market players pushed back expectations for the next U.S. rate hike and amid mounting concerns the U.K. will vote to leave the European Union in a referendum this month.
Elsewhere on the Comex, silver futures for July delivery dipped 3.6 cents, or 0.21%, to trade at $17.37 a troy ounce during morning hours in London, while copper futures tacked on 1.1 cents, or 0.54%, to $2.065 a pound.