LONDON: Gold rose as a surging dollar paused, but prices remained vulnerable just above a 15-month low touched earlier in the day on prospects of further gains in the US currency and growing bets the Federal Reserve will raise rates in mid-2015.

Bullion had dropped nearly two percent on Friday and reached its weakest since June 28, 2013 at $1,183.46 an ounce in earlier trading, within reach of a four-year low under $1,180 an ounce.

Spot gold rebounded to trade up 0.8 percent at $1,200.25 an ounce by 1444 GMT, while US gold futures were up $7.90 at $1,200.50 an ounce.

“Probably the market is a bit oversold after the sell-off and we are seeing the dollar a little bit lower and that is removing some selling pressure, but the worry of the market is that the halt in the dollar rally is temporary,” Saxo Bank senior manager Ole Hansen said.

Platinum, which fell 6.3 percent last week in its biggest weekly decline since Dec. 2011, touched its lowest since July 2009 in earlier trade on Monday.

Precious metals and commodities have tumbled as the dollar rallied to levels not seen for four years.

“These prices shouldn’t come as a surprise ... the US monetary policy starts tightening, the dollar is strong, rates are going higher, commodities are under pressure from more supply in China and gold is at the forefront of all of those fears and concerns,” Societe Generale analyst Robin Bhar said.

“We are just above the support of $1,180, we are going to test that level again pretty soon and after that there is the psychological level of $1,150.”

Forecast-beating US non-farm payrolls data bolstered bets the Federal Reserve would raise interest rates in mid-2015.

Non interest-bearing assets such as gold have benefited from the Fed keeping interest rates near zero since December 2008.

Speculators cut their bullish futures and option bets on gold to their smallest since early January, marking their seventh weekly consecutive decline, the Commodity Futures Trading Commission said on Friday.

Meanwhile, the absence of main gold consumer China is weighing on the physical market.

Chinese markets, shut for national holidays, will reopen on Wednesday.

Markets in Singapore, a key bullion trading center in southeast Asia, were also closed for a public holiday.

Premiums for gold in Asia were quoted at $1.20 to $1.60 an ounce to spot London prices, unchanged from last week.

In Tokyo, sellers pushed up premiums for gold bars to 25 cents to spot London prices from zero last week to offset the decline in global prices.

Platinumwas up 1.7 percent at $1,234.75 an ounce, having earlier fallen to $1,183.25 earlier. Palladium rose 0.3 percent to $755.25 an ounce, having touched its lowest since Feb. 27 earlier.

The metal has dropped 17 percent from $910 last month, which was its highest since February 2011.

Silver rose 1.6 percent to $17.07 an ounce after hitting its weakest since March 2010 at $16.66 earlier.