PRECIOUS-Gold steady ahead of Fed rate cut decision; silver extends rally above $60

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Silver hits record high of $61.61/oz

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Silver crossed $60/oz for the first time on Tuesday

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Fed rate cut decision due at 1900 GMT today

(Updates for EMEA morning session)

By Pablo Sinha

Dec 10 (Reuters) - Gold prices were little changed on Wednesday ahead of an anticipated Federal Reserve rate cut, with investors awaiting comments from Chair Jerome Powell on future policy moves, while silver extended its historic rally above $60 an ounce.

Spot gold fell 0.2% to $4,199.92 per ounce, as of 0844 GMT. U.S. gold futures for February delivery fell 0.2% to $4,228.10 per ounce.

Spot silver was up 1.2% at $61.37/oz after hitting an all-time high of $61.61 earlier in the session.

"Silver broke above the $60 per ounce mark, luring more short-term speculators and trend followers into the market. This also reflects the narrative of physical tightness in the silver market," said Julius Baer analyst Carsten Menke.

The white metal has risen 113% this year, driven by rising industrial demand, declining inventories, and its designation as a critical mineral by the United States.

The Federal Open Market Committee's (FOMC) two-day policy meeting concludes today, with a rate-cut decision expected at 1900 GMT, followed by Powell's remarks at 1930 GMT. Markets are assigning an 88% probability to a 25-basis-point reduction.

"During the past few weeks, the demand for gold from investors measured by holdings of physically-backed products was not as strong as for silver. We see this as the main factor holding back gold," Menke added.

Holdings of the largest gold-backed exchange-traded-fund (ETF), New York's SPDR Gold Trust, fell 0.1% on Tuesday, while New York's iShares Silver Trust, gained 0.53%.

Meanwhile, White House economic advisor Kevin Hassett, the frontrunner to replace Powell as Fed chair, said on Tuesday that there is "plenty of room" to cut interest rates further, though rising inflation could change that calculation.

Lower interest rates tend to favour non-yielding assets such as gold.

RBC Capital Markets raised its long-term gold price forecasts to an average of $4,600 per ounce in 2026 and $5,100 per ounce in 2027, citing geopolitical risks, softer monetary policy, and persistent budget deficits.

Elsewhere, platinum lost 1.2% to $1,670.70, while palladium fell 0.3% to $1,501.71. (Reporting by Pablo Sinha in Bengaluru; Editing by Alexandra Hudson)