Gold edged higher ‌on Monday from a more than one-and-a-half-month low recorded earlier in the session, although gains were capped as ​rising fears of inflation and elevated interest rates pushed global bond yields higher.

Spot gold was up 0.1% ​at $4,540.27 per ​ounce as of 1018 GMT, after hitting its lowest level since March 30 earlier on the day. U.S. gold futures for June delivery lost 0.4% at $4,544.

"The decline (in gold ⁠prices) is technically stretched, and markets don't seem ready to let gold drop into a bear territory as the structural case for gold remains intact, helping it find support," said Nikos Tzabouras, a senior market analyst at Jefferies-owned Tradu.com.

However, "with markets pricing out any Federal Reserve rate cuts (this ​year) and hike ‌bets on the ⁠rise, higher-for-longer prospects are ⁠dealing a direct blow to non-yielding assets like gold," he added.

Bonds from Tokyo to New York extended ​losses on Monday, with benchmark 10-year U.S. Treasury yields climbing to their ‌highest since February 2025, as rising energy prices ⁠from the ongoing Middle East war fanned inflation fears and stoked investor wagers on rate hikes from global central banks.

Brent crude oil rose above $110 a barrel as efforts to end the Iran war appeared to have stalled, keeping the key waterway of the Strait of Hormuz largely closed.

Traders are now increasingly pricing in a U.S. interest rate hike before year-end, with a 40% chance of a hike in December, according to CME Group's FedWatch tool. Meanwhile, banks have started trimming their near-term gold price forecasts due to softer investor demand, ‌with J.P.Morgan among the first major lenders to cut its 2026 ⁠average gold price forecast to $5,243 per ounce from $5,708. "While the coming ​weeks could still be quite volatile over the twists and turns in negotiations and interest rate repricing, this resolution (to the U.S.-Iran war) is key to beginning to re-stoke investor interest and demand for ​gold," analysts ‌at the bank noted.

Spot silver was down 0.3% at $75.70 per ounce, platinum lost ⁠0.2% at $1,968.77 and palladium fell 0.2% to $1,409.25.

(Reporting ​by Noel John in Bengaluru; Editing by Rashmi Aich and Jonathan Ananda)