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By Bloomberg

Gold dropped for a second day after Federal Reserve Chair Janet Yellen said she expects interest rates to rise this year in the world’s biggest economy, boosting the dollar for a third day. Palladium fell to a five-month low.

Bullion for immediate delivery fell as much as 0.5 percent to $1,192.95 an ounce and was at $1,193.16 at 10:26 a.m. in Singapore, according to Bloomberg generic pricing. While the metal lost 0.5 percent on Friday to snap the longest run of gains since 2012, it is still set to post the first quarterly rise since June. Gold in Shanghai dropped for a second day.

Gold rose to a three-week high on March 26 as Saudi Arabia headed a coalition of 10 Sunni-led nations attacking Shiite rebels in Yemen, spurring haven demand on concern the conflict may disrupt oil supplies. Yellen said Friday that she expects the central bank to raise rates this year, and that subsequent increases will be gradual without following a predictable path. Short holdings in gold climbed for a seventh week to a record, Commodity Futures Trading Commission data showed.

“Precious metals declined, as easing geopolitical concerns regarding Yemen reduced gold’s appeal as a safe haven,” Australia & New Zealand Banking Group Ltd. wrote in a note on Monday. Yellen’s comments signaled that “the tightening process would be gradual and ‘data-dependent’.”

Gold for June delivery lost 0.5 percent to $1,194.80 on the Comex. Bullion of 99.99 percent purity weakened 0.6 percent to 239.15 yuan a gram on the Shanghai Gold Exchange.

Palladium for immediate delivery declined as much as 0.5 percent to $737.45 an ounce, the lowest price since Oct. 16, and traded at $737.60. The metal is headed for a quarterly drop.

Silver fell 0.2 percent to $16.9191 an ounce and is set to climb 7.6 percent this quarter. Platinum lost 0.4 percent to $1,133 an ounce, heading for a third straight quarterly loss.