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Gold prices fell to their lowest in more than a week on Monday as the U.S. dollar firmed, while market focus shifted to a series of economic data due this week for clues to the extent of rate cuts at the Federal Reserve's September meeting.
Spot gold fell 0.1% to $2,501.06 per ounce, as of 10:34 GMT after dipping to its lowest since Aug. 23 earlier in the session.
U.S. gold futures rose 0.2% to $2,533.40. Trading is expected to be light with U.S. markets closed for a holiday.
"To move higher from here we need to have more clarity whether it will be 25 (bps) rate cut or 50 (bps) rate cut and probably by the end of the week, with the employment data, we might get more clarity on that side," UBS analyst Giovanni Staunovo said.
Traders await a slew of U.S. economic data pending this week including the ISM surveys, JOLTS job openings, ADP employment and the non-farm payrolls report.
The markets broadly expect the Fed to cut rates at its Sept. 17-18 meeting, which would mark its first cut in this policy cycle.
According to the CME FedWatch tool, investors now see a 71% chance of a 25-basis-point cut and a 29% chance of a 50 bp cut in September. Lower rates reduce the opportunity cost of holding non-yielding gold.
"With earnings season now largely completed and a Fed rate cut on Sept. 18 all-but guaranteed, investors appear content to remain long despite some recent firming of both short rates and the U.S. dollar," Mike Ingram, market analyst at Kinesis Money, said in a note.
"High levels of geopolitical risk and portfolio diversification remain as additional supports."
The dollar hovered near a two-week peak hit earlier in the session, making bullion more expensive for holders of other currencies.
Spot silver fell 0.7% to $28.62 per ounce, and hit its lowest in over two weeks.
Platinum was steady at $926.40 and palladium rose 0.5% at $969.99.
(Reporting by Rahul Paswan in Bengaluru; Editing by Kevin Liffey and Mrigank Dhaniwala)