Gold prices rose to an all-time high on Wednesday after the U.S. Federal Reserve cut interest rates by 50 basis points, sending the dollar lower.

Spot gold was up 0.9% at $2,592.39 per ounce as of 02:17 p.m. ET (1817 GMT). U.S. gold futures settled 0.2% higher at $2,598.60.

"Gold surges to all-time highs but bond yields have also jumped higher. A 50 bps is good for gold," said Tai Wong, a New York-based independent metals trader.

"Gold is in a bull market; it is likely to move higher. The velocity of that move will depend on Powell's tone."

The U.S. central bank kicked off what is expected to be a steady easing of monetary policy with half a percentage point cut on Wednesday.

Policymakers see the Fed's benchmark rate falling by another half of a percentage point by the end of this year and another full percentage point in 2025.

Lower interest rates decrease the opportunity cost of holding non-yielding bullion and weigh on the dollar, making gold cheaper for investors holding other currencies.

Following the Fed's cut, the dollar fell 0.5% - to its lowest since July 2023 against its rivals.

Investors now look forward to comments from Chair Jerome Powell at 1830 GMT for more cues on policy path.

Meanwhile, spot silver rose 0.6% to $30.93 per ounce, after hitting a two-month high on Monday.

"After a recent sell-off, silver prices are recovering with rising gold prices. Speculative as well as ETF (exchange-traded fund) holdings for silver are rising," ANZ said in a note.

Platinum was steady at $981.10 per ounce. Palladium was down 3.2% at $1,081.00.

(Reporting by Anushree Mukherjee and Brijesh Patel in Bengaluru; Editing by Krishna Chandra Eluri)