By Clara Denina
LONDON: Gold rose on Monday as the dollar edged lower after sluggish U.S. retail sales data lowered expectations of a U.S. interest rate increase this year.
Data on Friday showed U.S. retail sales were unexpectedly flat in July, signalling a moderation in consumer spending.
Spot gold was up 0.3 percent at $1,339.87 an ounce by 1138 GMT. The metal rose as much as 1.3 percent after the data on Friday, before giving up gains.
U.S. gold was up 0.1 percent at $1,345.10 an ounce.
Spot gold remained within reach of a more than two-year high of $1,374.91 hit last month as investors sought refuge from volatility across financial markets following Britain's vote to leave the European Union.
"We have Fed minutes coming out in the middle of the week, which is likely to tell us what the Fed's thinking is going into the second half of the year, when it probably going to come under pressure to raise rates," Mitsubishi Corp strategist Jonathan Butler said.
"In general the negative rate environment, particularly in the euro zone and Japan, is going to keep gold well bid and even though we may be seeing some tempering of gold's gains by the pretty strong equity market performance right now, that is going to come into question as the Fed looks to raise rates."