Front-month gold futures fell Monday in the largest one-day decline by dollar amount since November 2020, as news of a potential ceasefire agreement between Israel and Hezbollah in Lebanon further undermined safe-haven demand for the metal, as well as President-elect Trump's selection of Scott Beseent as his new Secertary of the Treasury.

Israel's security cabinet will vote Tuesday on a ceasefire agreement, Israeli and U.S. officials said, and the cabinet is expected to approve the pact.

The deal on the table reportedly includes a 60-day implementation period to allow the Israeli military to withdraw and for the Lebanese armed forces to secure the border area and prevent Hezbollah from re-establishing a presence there; an international committee along with United Nations peacekeepers would monitor compliance.

"Gold is also down on Scott Bessent's appointment... and the likelihood he would be a rock of stability versus some of other names that were being offered up as possible heads of Treasury, and also the likelihood Bessent will temper some of Trump's wish list, such as tariffs," Mizuho's Robert Yawger wrote.

Front-month Comex gold (XAUUSD:CUR) for November delivery closed -3.4% to $2,616.80/oz, its largest one-day dollar decline since November 9, 2020 and largest one-day percentage drop since June 17, 2021; the move stopped a five-session winning streak, but gold is still up 27% YTD.

Front-month Comex November silver (XAGUSD:CUR) ended -3.5% to $30.210/oz, its lowest settlement value since September 12.

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Between falling safe-haven demand and a hawkish repricing of U.S. interest rate cut expectations, gold's short-term outlook has turned moderately bearish, StoneX analyst Fawad Razaqzada said.

Even so, gold could still potentially rise to $3,000/oz in the slightly longer-term, Razaqzada wrote.