Grapevine

Gold rallies to record high on U.S. rate-cut optimism

One kilogram gold bars are displayed for a photograph at the YLG Bullion International headquarters in Thailand on January 13, 2016.

Gold prices soared to an all-time high on Friday as the dollar weakened amid prospects of a U.S. interest rate cut next week, while palladium has gained 15% so far this week.

Spot gold was up 0.2% at $2,565 per ounce, as of 0258 GMT, after hitting a record high of $2,567.93 earlier in the session. Bullion has gained 2.7% for the week so far.

U.S. gold futures rose 0.5% to $2,593.40.

The dollar fell to a one-week low, making gold less expensive for other currency holders.

"Gold has been building house following its latest foray higher. Gains have been steady in nature, and a period of consolidation wouldn't be surprising before gold perhaps takes a run at $2,600 should the dollar remain on the backfoot," said Tim Waterer, chief market analyst at KCM Trade.