Spot gold was down 0.3 percent at $1,244.22 per ounce at 12:34 p.m. EST (1734 GMT), having touched $1,250.55, its highest since July 11. US gold futures were 0.2 percent lower at $1,249.70 per ounce. "With the vote on Brexit being pulled, there is a rise in the dollar which is keeping pressure on gold at the moment," said Bob Haberkorn, senior market strategist at RJO Futures.
The pound slid to its weakest level in nearly 1-1/2 years against the dollar as British Prime Minister Theresa May postponed a parliamentary vote on her Brexit deal. The dollar rebounded after posting its biggest weekly drop in more than three months last week as weak US data reduced expectations of more US interest rate increases.
The US Federal Reserve is widely expected to raise rates at its Dec. 18-19 meeting, but the focus will be on how many hikes will follow in 2019. Gold tends to gain when rate hike expectations recede as lower rates reduce the opportunity cost of holding non-yielding bullion and weigh on the dollar, in which it is priced.
Meanwhile, losses on global stocks snowballed on Monday as fresh signs emerged that the US-China trade spat was taking a deeper toll on world economic growth. "It's really encouraging that gold has risen to the $1,250 level at the same time when equities were soft and this really underpins gold's role as a safe haven," said Julius Baer analyst Carsten Menke.
Gold rose more than 2 percent last week, its best performance since the week of March 23 and has recovered about 8 percent from a 19-month low of $1,159.96 in mid-August. Reflecting investor interest in bullion, holdings in SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, rose 0.20 percent to 759.73 tonnes on Friday. Among other precious metals, spot silver slipped 0.4 percent to $14.55 per ounce, while palladium dipped 1.2 percent to $1,208.90.
Platinum fell 1.1 percent to $781 per ounce. The metal slipped to $775 earlier, its lowest since Sept. 10.