US gold futures for December delivery fell 0.1% to $2,687.90.
The dollar remained near the 18-month highs it reached in the previous session, making greenback-denominated metals more expensive for holders of other currencies.
US Consumer Price Index (CPI) data is scheduled for release on Wednesday, followed by Producer Price Index (PPI) data on Thursday.
Kyle Rodda, a senior financial market analyst at Capital.com, said, "The CPI data will be crucial for the short-term trajectory of gold."
He added that if inflation comes in higher than expected, particularly in the core reading, it could bolster expectations for an October rate hike, albeit to a limited extent, which could push gold further down.
Appetite for gold usually wanes when interest rates are high, as investors tend to favor yield-bearing assets.
The CME FedWatch tool shows that traders are pricing in a 21% chance of a US rate hike this month, compared to 88% for a hike in December.
Saudi Arabia said it is facing a new wave of attacks and that Riyadh airport will remain closed for the time being, after a missile strike targeted the airport's departure terminal on Saturday, causing casualties, for which the Iran-aligned Houthi group in Yemen claimed responsibility.
As for other precious metals, spot silver fell 0.5% to $30.01, platinum dropped 0.2% to $932.47, and palladium declined 0.5% to $977.69.