LONDON: Gold retreated from the previous session’s near three-week high on Monday as strength in stocks and the dollar dampened a rally fueled by the Federal Reserve’s decision last week to keep US interest rates on hold.

European stocks climbed 0.6 percent on Monday, while the dollar rose against a basket of currencies after speculation that other major central banks may ease policy after the Federal Reserve delayed an interest rate hike.

Spot gold was down 0.5 percent at $1,133.30 an ounce at 1402 GMT, while US gold futures for December delivery were down $4.80 an ounce at $1,133.00.

Gold held in a narrow range earlier this month on uncertainty over whether the Fed would hike rates for the first time in nearly a decade, lifting the opportunity cost of holding non-yielding bullion while potentially boosting the dollar.

It rose sharply after the Fed shied away from a hike on Thursday, peaking at $1,141.50 the following day, but has now retreated below that level.

With the Fed still expected to hike rates before the end of the year, gold could come under pressure again.