Gold tests $1,240 for first time in three months

Gold futures rose over one percent in American trade to July 17 highs, as the dollar index fell off August 20 highs, ahead of minor US industrial data later today. 

As of 02:13 GMT, gold futures due in December rose 1.22% to $1,239.50 an ounce, marking three-month highs, as the dollar index shed 0.06% to 95.96 off two-month highs. 

Now markets await the US Richmond manufacturing index for October, expected with a dip to 25 from 29 in September, while Federal Reserve Bank of Atlanta President Raphael Bostic is scheduled to speak about the economy and monetary policy at Louisiana State University, in Baton Rouge. 

The Federal Reserve recently released the minutes of its September 25-26 meeting, at which the Federal Open Market Committee voted to increase interest rates by 25 basis points for the third time this year to just below 2.25% as expected, while carrying on plans to normalize the balance sheet. 

The Fed forecast another rate hike this year, and three more next year, and another in 2020, as the economy blisters ahead. 

Otherwise, Gold holdings at SPDR Gold Trust, the world's largest gold-backed investment fund, rose 2.06 tonnes on Monday to a total of 747.88 tonnes, after prices marked the sixth monthly loss in a row in September, the longest such losing streak since late 1996.