Gold hits 4-month low as the U.S. dollar rose on comments by the Fed Chair Janet Yellen. She said that she expects the U.S. economy to strengthen in the rest of the year, and that the Fed could raise its interest rate "at some point this year".
Yellen noted that there is "still some slack" in the U.S. labour market.
She also said that the situation in Greece and China could "pose some risk" to the U.S. economy.
The better-than-expected U.S. economic data also weighed on gold price. The U.S. producer price index increased 0.4% in June, exceeding expectations for a 0.2% gain, after a 0.5% rise in May.
On a yearly basis, the producer price index decreased 0.7% in June, beating forecasts of a 0.9% decline, after a 1.1% fall in May.
The rise was driven by higher food and gasoline prices. Gasoline prices jumped 4.3% in June. Food prices climbed by 0.6%, driven by a shortage of eggs, and as wholesale egg prices soared a 84.5% in June.
The producer price index excluding food and energy climbed 0.3% in June, exceeding expectations for a 0.1% gain, after a 0.1% increase in May.
On a yearly basis, the producer price index excluding food and energy climbed 0.8% in June, beating forecasts of a 0.7% increase, after a 0.6% rise in May.
The U.S. industrial production rose 0.3% in June, exceeding expectations for a 0.2% increase, after a 0.2% decline in May. It was the biggest increase since November 2013.
The increase was driven by higher mining and utilities output. Mining output climbed by 1.0% in June, while utility output rose by 1.5%.
The U.S. manufacturing production flat in June.
Capacity utilisation rate increased to 78.4% in June from 78.2% in May. May's figure was revised up 78.2%. Analysts had expected a capacity utilisation rate of 78.1%.
Market participants are awaiting the results of the Greek parliament's vote. The Greek government should pass a series of reforms in the Greek parliament to start talks about the third bailout programme.
August futures for gold on the COMEX today declined to 1144.30 dollars per ounce.