![Gold extends record rally on Fed rate-cut bets, softer dollar](https://img.etimg.com/thumb/msid-111822387,width-210,height-158,imgsize-56006,resizemode-75/gold-extends-record-rally-on-fed-rate-cut-bets-softer-dollar.jpg)
Spot gold dropped about 0.6% to $2,454.98 per ounce by 1748 GMT due to profit-taking after hitting an all-time high of $2,483.60 earlier in the session.
U.S. gold futures settled 0.3% lower to $2,459.90 per ounce.
"The expectation that we are getting closer to a Fed interest rate cut and we've seen this as yields continue to slowly grind lower in anticipation, that, along with a weaker dollar, are the main supportive factors behind this gold move," said David Meger, director of alternative investments and trading at High Ridge Futures.
More Fed policymakers have suggested they are getting increasingly comfortable that the pace of price increases is more firmly on track, back down to the Fed's goal, after higher-than-expected readings earlier in the year.
Fed Governor Christopher Waller said the time for a U.S. central bank interest rate cut "is drawing closer", but uncertainty about the path of the economy makes it unclear when a lowering in the cost of short-term borrowing might happen.
Data showed production at U.S. factories increased more than expected in June, contributing to a solid rebound in output in the second quarter.
Markets now see a 98% chance of a U.S. rate cut in September, according to the CME FedWatch Tool.
Lower interest rates decrease the opportunity cost of holding non-yielding bullion and weigh on the dollar, making gold cheaper for investors holding other currencies.
The U.S. unit weakened about 0.5% to near a four-month low against a basket of currencies. [USD/]
Elsewhere, silver fell 3.7% to $30.21 per ounce. Platinum shed 0.4% to $996.30 and palladium dropped 0.5% to $953.93.
(This story has been corrected to fix the record-high price of gold in paragraph 2)
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