Gold prices fell nearly 1 per cent to ₹1.49 lakh per 10 grams in futures trade on Monday as a stronger US dollar kept a lid on bullion's recovery.

On the Multi Commodity Exchange (MCX), the yellow metal for December delivery fell ₹1,020, or nearly 1 per cent, to ₹1,49,370 per 10 grams. (REUTERS)

On the Multi Commodity Exchange (MCX), the yellow metal for December delivery fell ₹1,020, or nearly 1 per cent, to ₹1,49,370 per 10 grams.

Gold had shed ₹2,887, or 2 per cent, in a holiday-shortened last week, to end at ₹1.5 lakh per 10 grams.

Domestic commodity markets were closed on Friday on account of Mahatma Gandhi Jayanti.

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"Gold prices have remained in a consolidating phase as a stronger US dollar and elevated bond yields continue to limit upside momentum," said Kaveri More, Commodity Technical Analyst at Choice Broking.

The dollar index was hovering near an 18-month high of 102.37, keeping pressure on bullion, she added.

In global markets, Comex gold futures for December delivery traded marginally higher at USD 4,163.50 per ounce in New York.

Gold is holding above USD 4,150 per ounce in overseas trade after briefly crossing USD 4,200 on Friday, supported by a weak US jobs report that cut October rate hike expectations by the Federal Reserve to below 20 per cent, said Akshat Siddhant, Lead Quant Analyst at investment platform Mudrex.

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However, investors are still pricing a nearly 70 per cent chance of a December hike, he said.

Last week, gold in the international markets fell USD 158.9, or 3.7 per cent, to close at USD 4,162.3 per ounce, while silver dropped USD 4.38, or 6.7 per cent, to USD 60.41 per ounce.

According to Manav Modi, Commodities Analyst at Motilal Oswal Financial Services Ltd, bullion's recovery remains constrained by elevated US Treasury yields, with the 10-year yield holding around 5.2 per cent amid persistent inflation, fiscal concerns and heavy government borrowing.

"Gold therefore remains caught between cooling labour conditions and persistent yield and dollar pressures," Modi said.

Analysts said investors closely tracking the Services PMI data from major economies, US trade figures and mid-month consumer sentiment data due later in the week will also provide cues, while the unresolved US-Iran situation could add another layer of volatility in precious metals.