Gold took a breather from a record run on Thursday, as investors booked profits a day after bullion breached the $4,000 level for the first time ever on economic and geopolitical uncertainties and hopes of further US interest rate cuts this year.
Spot gold lost 0.2% to $4,029.86 per ounce, as of 0642 GMT, after hitting a record high of $4,059.05 on Wednesday.
US gold futures for December delivery fell 0.6% to $4,047.80, Reuters said.
On Wednesday, Israel and Hamas agreed to the first phase of U.S. President Donald Trump's plan for Gaza, a ceasefire and hostage deal that could open the way to ending Israel's bloody two-year-old war, which the UN says constituted a genocide.
"You can't look past the significance of the Phase-one deal between Israel and Hamas (given) one of the reasons why gold's been moving higher is geopolitical risks, but it's probably just a handy excuse to take profits after hitting another record," said Capital.com analyst Kyle Rodda.
Meanwhile, Federal Reserve officials agreed that risks to the US job market were high enough to warrant a rate cut, but remained wary amid stubborn inflation, per minutes of the September 16–17 meeting released on Wednesday.
Markets are pricing in a 25-basis-point cut each in October and December, with probabilities of 93% and 78%, respectively, per the CME FedWatch tool.
"We still see things as being rather constructive because all the fundamentals (for gold) remain pointed upwards," he added.
Non-yielding gold thrives in a low-interest-rate environment and during times of economic and geopolitical uncertainties.
Global markets struggled this week amid political turmoil in Japan and France, coupled with an ongoing US government shutdown, sparking a flight to safety in gold.
Gold has climbed 54% year-to-date on strong central bank buying, increased demand for gold-backed Exchange-Traded Fund (ETFs), a weaker dollar and safe-haven demand.
Elsewhere, spot silver gained 0.4% to $49.06 per ounce, after hitting an all-time high of $49.57 on Wednesday. Platinum slipped 0.6% to $1,653.52 and palladium rose 1.1% to $1,465.73.
