Gold holds four-day gains amid uncertainty over Federal Reserve Policy

Gold prices maintained a four-day rally as traders sought safe-haven assets in response to a wave of risk aversion sweeping markets, driven by renewed uncertainty over the Federal Reserve's interest rate trajectory.

Gold bullion traded near a one-month high at around $2,690 per ounce after gaining 1.9% last week, despite headwinds from bond yields and a strong dollar.

A Friday report highlighted exceptional resilience in the U.S. labor market, prompting experts at major banks to revise downward their expectations for future interest rate cuts.

Although higher borrowing costs are typically negative for non-yielding precious metals, investors are bracing for more volatility as the prospect of Donald Trump’s return to the White House looms.

Chris Weston, Head of Research at Pepperstone Group, noted in a memo to Bloomberg that stronger-than-expected data last week led traders to shift away from equities and into safe-haven assets such as the dollar and gold.

Investors are now turning their attention to upcoming U.S. inflation figures, with the Consumer Price Index set for release on Wednesday. They will also monitor the New York Federal Reserve's annual inflation expectations report on Monday, producer prices on Tuesday, and unemployment claims on Thursday.

Spot gold was little changed at $2,689.71 per ounce as of 8:35 a.m. in Singapore. The Bloomberg Dollar Spot Index remained steady, as did silver and palladium, while platinum edged lower.