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 Gold fell more than 1% to its lowest in 3-1/2 months on Monday as elevated bond yields and overall strength in the dollar dampened bullion demand, even as riskier assets dropped after grim China economic data.

A stronger dollar makes gold expensive for overseas buyers, while higher Treasury yields raise the opportunity cost of holding zero-yield bullion.

Spot gold was down 0.2% to $1,807.64 per ounce as of 1311 GMT, after earlier hitting its lowest since Jan. 31 at $1,786.60. U.S. gold futures were little changed at $1,808.10.

"Spot gold may not stray far from $1,800, suppressed by the might of King Dollar and elevated Treasury yields, while supported by the looming prospects of a recession," said Han Tan, chief market analyst at Exinity.

Gold prices are down over 13% since scaling a near-record peak of $2,069.89 an ounce in March. [USD/] [US/]

"Having now fallen through the psychologically important threshold of $1,800 an ounce and with the hawkish monetary policy more likely to strengthen than weaken, it is hard to see where gold can now find a short-term foothold," Rupert Rowling, market analyst at Kinesis Money, said in a note.

The dollar consolidated near a two-decade peak while risk appetite took a hit after weak economic data from China highlighted fears about a slowdown. [MKTS/GLOB]

Silver has found itself caught up in the broader sell-off in equities and gold, being punished for being an industrial metal at a time when growth forecasts are being trimmed, Rowling added.

Spot silver gained 0.9% to $21.26 per ounce, after slumping to its lowest since July 2020 on Friday.

Platinum rose 0.2% to $940.16 and palladium was up 1.2% to $1,966.80.

Johnson Matthey said a surplus in the platinum market should shrink this year and the palladium markets are likely to move back into deficit.