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After a record-breaking run, gold takes a break.

On Thursday, gold took a break from its record-breaking run as investors booked profits. This was a day after the bullion broke the $4,000 barrier for the first ever time on the back of economic and geopolitical uncertainty and the hope that the U.S. will continue to cut interest rates this year.

As of 0642 GMT spot gold fell 0.2%, to $4,029.86 an ounce. It had hit a record-high of $4,059.05 per ounce on Wednesday.

U.S. Gold Futures for December Delivery fell by 0.6% to $4.047.80.

Israel and Hamas reached an agreement on Wednesday to implement the first phase in U.S. president Donald Trump's plan to end the bloody war that has raged for two years between Israel and Hamas. The U.N. calls this conflict a genocide.

Capital.com analyst Kyle Rodda said: "It's hard to ignore the importance of the Phase-one agreement between Israel and Hamas, given that geopolitical risk is one of the main reasons gold has been rising. But it's likely just an excuse for taking profits after another record was set."

According to minutes from the Federal Reserve's September 16-17 meeting, released on Wednesday, officials acknowledged that the risks facing the U.S. employment market were sufficiently high to justify a rate reduction, but they remained cautious due to stubborn inflation.

According to the CME FedWatch, markets are pricing a 25 basis-point reduction in each October and December with probabilities of 93% et 78%.

He added, "We continue to see the situation as constructive since all fundamentals (for Gold) are still pointing upwards."

Gold that does not yield is a good investment in low interest rate environments and times of geopolitical and economic uncertainty.

The global markets have struggled in the past week due to political turmoil in Japan, France and the United States, as well as a government shutdown that continues. This has led many investors to seek safety in gold.

Gold is up 54% in the last year due to strong central bank purchases, an increase in demand for gold-backed Exchange-Traded Funds (ETFs), and a weaker US dollar.

Silver spot gained 0.4%, to reach $49.06 an ounce after reaching a record high of $49.57 per ounce on Wednesday. Palladium jumped 1.1% to 1,465.73 and platinum fell 0.6% to $1653.52. (Reporting and editing by Ishaan arora in Bengaluru, Ronojoy Mazumdar, Rashmi aich and Sumana nandy)

(source: Reuters)