Spot gold was down 0.4% at $1,687.79 per ounce, as of 0348 GMT, after hitting its lowest since Oct. 3 at $1,686.45. U.S. gold futures were down 0.8% at $1,695.60.
The dollar index was steady after touching a one-week high on Friday. A stronger greenback makes gold costlier for buyers holding other currencies.
"Gold prices are taking their cue from the build-up in rate-hike expectations from last week, brought on by the hotter-than-expected U.S. job report," said IG market strategist Yeap Jun Rong.
Data showed on Friday U.S. job growth slowed moderately in September while the unemployment rate dropped, signalling a resilient economy and dousing hopes of a Fed pivot anytime soon.
Investors will now focus on the U.S. inflation data due later this week. Headline consumer price inflation is seen slowing a touch to an annual 8.1%, but the core measure is forecast to accelerate to 6.5% from 6.3%.
"The core CPI is expected to show some persistence and should keep the Fed's rate-hike process well-anchored," said Yeap adding that gold prices seemed to remain locked in a downward trend for now.
While gold is often seen as a hedge against inflation, rising U.S. interest rates increase the opportunity cost of holding the non-yielding gold.
Gold prices have declined more than $350 since surging past the $2,000-mark in March, amid aggressive U.S. monetary policy tightening.
Holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, fell by 2.03 tonnes on Friday, marking its biggest outflow since late September.
Spot silver was down 2% at $19.71 per ounce after hitting a one-week low. Platinum fell 0.7% to $905.51, while palladium inched 0.1% higher to $2,183.99.
(Reporting by Eileen Soreng in Bengaluru; Editing by Sherry Jacob-Phillips and Subhranshu Sahu)
By Eileen Soreng
