Gold retreated on Thursday as investors sold to take profits following a day when the yellow metal broke the $4,000 per ounce barrier and hit a new record high amid economic and geopolitical uncertainty and expectations of U.S. interest rate cuts.

Spot gold fell 0.4% to $4,021.99 per ounce by 01:17 GMT after hitting a record high of $4,059.05 on Wednesday.

U.S. December gold futures dropped 0.7% to $4,042.60, according to Reuters.

According to the CME FedWatch tool, markets expect an additional 25 basis point rate cut in both October and December with probabilities of 95% and 83%, respectively.

Gold, which yields no income, typically thrives in low interest rate environments and times of economic uncertainty.

This week, markets have been unsettled by political turmoil in Japan and France alongside the ongoing U.S. government shutdown, boosting investor demand for safe-haven assets like gold.

Gold has surged 54% year-to-date, supported by central bank purchases, growing demand for gold-backed ETFs, a weaker dollar, and increased retail investor interest seeking hedges amid rising trade and geopolitical tensions.

Other precious metals saw silver rise 0.1% to $48.91 per ounce after reaching an all-time high of $49.57 on Wednesday. Platinum fell 0.7% to $1,650.60, while palladium dropped 1% to $1,435.25.