By Ed Ballard 

LONDON--Gold prices fell on Tuesday as the dollar strengthened on the prospect of a U.S. rate increase in March.

The precious metal was down 0.6% at $1,228.42 a troy ounce in morning trade in London, extending a decline sparked Monday by Federal Reserve Bank of Philadelphia President Patrick Harker, who said he could support raising short-term interest rates at the Fed's next meeting.

The WSJ Dollar Index was up 0.5% at 91.41, making dollar-denominated commodities more expensive for holders of other currencies.

The U.S. session will bring a glut of commentary from U.S. monetary policy makers, including speeches by three Fed officials and the minutes of the Fed's January meeting.

"If they [the minutes] were to contain further indications of a rate hike in the near future, gold would probably fall further," wrote analysts at Commerzbank.

The pressure could continue ahead of the Fed's March 15 meeting if officials make a concerted effort to convince market participants that they will lift rates three times this year, as suggested by Fed Chairwoman Janet Yellen.

"Comments from several [Federal Open Market Committee] members this week could also trigger some near-term volatility as these feed through to Fed expectations," said Joni Teves, a precious metals strategist at UBS.

Commerzbank noted that while the strong dollar is weighing on dollar-denominated gold futures, gold is trading at a three-month high around EUR1,168 an ounce in euro terms.

The strength is "hardly surprising" given the abundance of political uncertainty surrounding Greek debt talks and upcoming elections, the bank said.

Silver was down 0.8% at $17.90 an ounce, palladium was down 0.8% at $766.15 an ounce and platinum was down 0.9% at $994.50 an ounce.

Write to Ed Ballard at ed.ballard@wsj.com

(END) Dow Jones Newswires

February 21, 2017 06:44 ET (11:44 GMT)