In late afternoon London deals, gold soared 1.7 percent to touch $2,463.80 per ounce, crushing its previous pinnacle of $2,450.07 reached in May.

Gold price hits record high on rate cut expectations, illustration photo/ Source: freepik.com

Ricardo Evangelista of ActivTrades saw gold benefiting "from the weakening of the dollar and the decline in Treasury yields," which are gold's rival assets, after the publication last week of data confirming that inflation in the United States was returning to levels close to those hoped for by the Fed.

"There is no doubt that the recent surge in gold prices can be at least partially attributed to a declining dollar and falling bond yields, thanks to weaker-than-expected US data and an unexpected drop to 3 percent in US consumer inflation last week," said Fawad Razaqzada, analyst at City Index.

He added that "gold continues to attract interest for its value retention capabilities."