Gold prices slipped in thin trade on Monday, as markets awaited next week's US economic data and the potential impact of President-elect Donald Trump's return to office on the Federal Reserve's 2025 outlook.

Spot gold was down 0.3 percent to $2,611.39 per ounce as of 0854 GMT. US gold futures fell 0.3 percent to $2,624.00.

"Quiet day with lower liquidity across all asset classes likely due to the holiday season," UBS analyst Giovanni Staunovo said, adding that market participants will track upcoming US economic data to see if the economy is slowing down, allowing the Fed to keep cutting interest rates.

Gold has gained around 27 percent so far this year, with it hitting an all-time high of $2,790.15 on Oct. 31.

Fed Chair Jerome Powell said earlier this month that US central bank officials "are going to be cautious about further cuts" after an as-expected quarter-point rate reduction in December.

After this quiet week, traders are set to focus on next week's US job openings data, ADP employment report, the Fed's December FOMC meeting minutes, and the US employment report, all of which could provide insights into the health of the world's largest economy.

Looking ahead, "we still see the same factors in place which supported gold in 2024 - ongoing central bank purchases with a desire to diversify their reserves and ongoing US rate cuts supporting investment demand," Staunovo said.

Markets are gearing up for significant US policy shifts in 2025, including potential tariffs, deregulation, and tax changes, as Trump prepares to return to the White House in January.

Gold is considered a hedge against economic and geopolitical turmoil.