Gold edges higher with spotlight on Fed policy path

Gold prices moved higher on Friday and headed for a fifth straight weekly gain, with market attention focused on further US rate cut cues after the Federal Reserve delivered its first rate cut of the year, reports Reuters.

Spot gold was up 0.3% at $3,653.86 per ounce by 9:17 am EDT (1317 GMT). Prices are up 0.3% so far this week.

US gold futures for December delivery gained 0.2% to $3,686.60.

The US central bank cut its key interest rate by 25 basis points on Wednesday but tempered the move with warnings about persistent inflation, casting doubt over the pace of future easing.

Following the decision, spot gold prices hit a record high of $3,707.40 before retreating in volatile trading.

"Gold remains pretty strong here and is just seeing a pause after the Fed. The bullish trend remains intact with new highs inevitable and realistically we could see $4,000 before year-end," said RJO Futures market strategist Bob Haberkorn.

Fed Bank of Minneapolis President Neel Kashkari said job market risks warranted this week's rate cut and likely reductions at the central bank's next two meetings.

Lower interest rates reduce the opportunity cost of holding non-yielding assets like gold.