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Underlining links
https://www.usability.gov/get-involved/blog/2007/05/underlining-links.html
Links should be organized and presented in such a way that users should be able to intuit "clickability." The specific solution, underlined or not, is less important than consistently using one or the other.
https://theadminbar.com/accessibility-weekly/underline-your-links/
Exceptions
Success Criterion 1.4.1 doesn’t explicitly require underlines; it just requires that you add some other visual indicator. In some cases, adding an icon (such as a right-pointing arrow) next to a link would be sufficient to differentiate it as a link if there is also additional padding or margin around the link and if it has a different font weight, size, or style from standard paragraph text.
Navigation menus are another place where underlines are not required because their design makes it clear that they are clickable elements.
https://www.w3.org/WAI/EO/Drafts/tutorials/navigation/styling/
While in-text links usually need an underline to help people with low vision or color blindness distinguish them from the surrounding text, this is not needed for links in menus if the menu can be clearly identified as such. If icons or images are used in links, an appropriate alternative text should be provided.