Gold tumbles 1% below $1,300 as dollar strengthens

Gold futures fell over one percent in American trade, marking the lowest since October 10, as the dollar index hit the highest in a week, following a basket of data from the US, the world's largest economy. 

As of 03:06 GMT, gold futures due on December 16 fell 1.22% to $1,287.10 an ounce from the opening of $1,303.00, while the dollar index rose 0.39% to 93.67 from the opening of 93.31, marking the highest since October 10. 

Earlier US data showed industrial production grew 0.3% in September in line with expectations, compared to a 0.7% drop in August, revised from a 0.9% fall, while the Capacity Utilization Rate rose to 76.0% from 75.8% in August, missing expectations of 76.2%. 

Gold futures are moving farther away from the highest since September 26 on profit-taking, as the dollar index continued to rebound for the third straight session after US 10-year treasury bond yields surged. 

Markets are pricing in a move by US president Donald Trump to choose a hawkish Federal Reserve Chair who would keep up the path of policy tightening after Janet Yellen terms ends next February, with John Taylor moving to the top of the pack of possible candidates after meeting with Trump last week.