Gold near 2-month low

LONDON, Aug 25 (Reuters): Gold held close to its lowest in two months on Monday, as the dollar marched higher after central bank heads signalled that interest rates were set on a diverging course in the United States, Europe and Japan.
At a gathering of central bankers in Jackson Hole, Wyoming, Federal Reserve chair Janet Yellen nodded to the concerns of some Fed officials about the sustained level of monetary policy stimulus, even as she stressed the need to move cautiously on raising rates.
The heads of the European Central Bank and Bank of Japan pledged more policy stimulus, which weighed on the euro and the yen versus the U.S. currency.
Gold was down 0.2 per cent to $1,276.94 by 0950 GMT. The metal fell 1.8 per cent last week, its biggest weekly fall in a month, hurt by strong U.S. economic data and speculation of an early interest rate hike, which sent the metal to its lowest in two months at $1,273.06 on Thursday.
U.S. gold futures lost $2.40 to $1,277.70 an ounce. Electronic trading was halted for four hours on Monday due to a technical glitch.
The dollar was up 0.3 per cent against a basket of major currencies, aided by steadier yields on Treasury notes, making gold more expensive for other currency holders.
The metal, however, held above charts support around $1,270, traders said, as liquidity was drained by the absence of UK players on a Bank Holiday weekend.