Gold Futures Pull Back

Updated from 12:51 p.m. EST

Gold prices took a dip Monday as the greenback rallied in anticipation of bullish comments by Federal Reserve Chairman Ben Bernanke later this week.

April-dated contracts eased $5 to close at $667.30 an ounce on the Comex division of the New York Mercantile Exchange. The PowerShares DB Gold(DGL Quote) exchange-traded fund, which tracks futures prices, was slipping 0.6%.

The bullion ETFs that hold inventories of gold, iShares Comex Gold Trust (IAU Quote) and streetTracks Gold Shares (GLD Quote), were down 0.8% and 0.7%, respectively.

"The market is expecting a more hawkish tone from Federal Reserve Chairman Ben Bernanke, opening the door to monetary tightening," says Alan Gayle, senior investment strategist at Trusco Capital Management, in Richmond, Va.

On Wednesday, Bernanke will begin two days of testimony to the Senate Banking Committee detailing the state of the economy and plans for future changes in monetary policy.

Gayle notes that late last year, a disconnect existed between the bond market, which saw future weakness in the U.S. economy, and the Fed, which seemed to see strength ahead. During January, fixed-income investors fell more in line with the stated view of Fed board members.

A robust economy would likely steer policymakers toward hiking interest rates, which would in turn help support the greenback. Foreign-exchange investors often choose currencies on the basis of yield on short-term government debt.