PRECIOUS-Gold slips ahead of Fed's rate decision; silver drifts near record high

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Fed expected to cut rates, decision due at 2 p.m. ET

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Markets pricing in 89.6% chance of a rate cut

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Silver hits record high of $61.61/oz

(Updates for AMERS morning session)

By Sarah Qureshi and Anushree Mukherjee

Dec 10 (Reuters) - Gold prices edged lower on Wednesday as investors booked profits ahead of the U.S. Federal Reserve's interest rate decision and Chair Jerome Powell's remarks later today, while silver hovered below record high levels.

Spot gold was down 0.3% at $4,198.28 per ounce at 0948 a.m. ET (14:48 GMT). U.S. gold futures for February delivery inched 0.2% lower to $4,227.40 per ounce. Spot silver fell 0.2% to $60.56/oz, after hitting an all-time high of $61.61 earlier in the session.

"All you really want to make note of right now is some light profit-taking ahead of the Fed meeting- a very highly anticipated event later this afternoon," said David Meger, director of metals trading at High Ridge Futures.

The Federal Open Market Committee (FOMC) will announce its rate decision at 2:00 p.m. ET (1900 GMT), with Powell scheduled to speak at 2:30 p.m. ET (1930 GMT).

Traders are pricing in an 89.6% chance of a 25-basis point rate cut this month, according to CME's FedWatch Tool, and expect further easing in 2026.

"We might be on a path of rate cut and pause... we still believe we're in a sideways-to-higher uptrend, with just a little bit of a pause," Meger added.

The meeting is among the most divisive in years, as policymakers weigh lowering borrowing costs to support the labor market against the risk of reigniting inflation.

A lack of fresh economic data following the recent 43-day government shutdown, coupled with uncertainty over who will lead the Fed next year, adds to the challenge. White House economic adviser Kevin Hassett, a proponent of rate cuts, is seen as a front-runner for the role.

Meanwhile, silver has surged 110% so far this year, supported by rising industrial demand, falling inventories, and its designation as a critical mineral by the U.S.

"We believe the gold-silver ratio, which had been extended to over 100, is coming back to some type of historical norm at this point in time," Meger said.

It now takes 69 ounces of silver to buy an ounce of gold , down from 82 ounces in October.

Platinum lost 2.8% to $1,642.30, while palladium fell 2.7% to $1,466.21. (Reporting by Sarah Qureshi and Anushree Mukherjee in Bengaluru; Editing by Shailesh Kuber)