[BENGALURU] Gold prices fell on Monday as investors turned to riskier assets on signs of economic growth following reports of an expanding Chinese factory sector and a rising US dollar reduced demand.

Spot gold fell 0.3 per cent to US$1,459.23 per ounce by 0332 GMT. Prices earlier touched their highest since Nov 22.

US gold futures shed 0.5 per cent to US$1,465.30.

"A slightly stronger dollar has weighed on investor appetite for gold, as well as some slightly more positive data, so this is causing gold to drift a little bit lower," ANZ analyst Daniel Hynes said.

An unexpected expansion in factory activity during November in China, the world's second-largest economy and biggest gold user, spurred investors into equity markets and reduced the interest in safe-haven bullion.

This followed official government data on Saturday that also showed an expansion.

Investor demand for gold was further pressured by the rising US dollar, which makes US dollar-denominated gold more expensive for buyers using other currencies.

The uncertainty around a resolution to the 17-month-old trade dispute between the United States and China has supported gold, with reports that a preliminary agreement has now stalled because of US legislation supporting protestors in Hong Kong and Chinese demands that the United States roll back its tariffs as part of phase one deal.

"Nothing particularly has really changed (on the trade front) from last week, the market remains in the dark about how things will progress. Investor appetite for gold is just waning a little bit on lack of direction," Mr Hynes said.

Gold has risen more than 13 per cent this year mainly due to the trade dispute war driving demand for safe assets.

"The fundamentals are still quite supportive, this lull is not going to last too much longer. Maybe into year end we will see gold prices recommit the uptrend we saw earlier this year," Mr Hynes said, adding until then gold will trade between US$1,450-US$1,500.

Elsewhere, silver fell 0.6 per cent to US$16.92 per ounce, platinum shed 0.4 per cent to US$896.72 and palladium was down 0.1 per cent to US$1,840.09.

REUTERS