Gold prices firmed near three-week highs on Friday on a softer U.S. dollar and safe-haven flows, with the metal set for a weekly gain as attention turned to upcoming U.S. economic data and President-elect Donald Trump's proposed policy changes.
Spot gold was up 0.1% at $2,660 per ounce as of 0525 GMT, hitting its highest level since Dec. 13 earlier in the session. Bullion is up about 1.5% for the week so far.
U.S. gold futures rose 0.2% to $2,675.30.
The dollar index fell 0.2%, making dollar-priced bullion a tad more affordable for holders of other currencies.
"We have seen an uptick in safe-haven flows, which has been to the benefit of gold," said Tim Waterer, chief market analyst at KCM Trade.
"Any pullback in the U.S. dollar could prove to be a catalyst for gold to break out higher."
Trump's upcoming inauguration on Jan. 20 has heightened uncertainty, with his proposed tariffs and protectionist policies expected to be inflationary and potentially spark trade wars.
On the geopolitical front, Israeli air strikes killed at least 68 Palestinians in Gaza. Meanwhile, Russia launched a drone strike on the Ukrainian capital Kyiv on Wednesday, causing damage in at least two districts.
On the economic front, a flurry of U.S. data next week -- including the nonfarm payrolls report and minutes of the Federal Reserve's meeting -- will give traders cues on monetary policy given the Fed has lowered its forecast for rate cuts in 2025.
Gold flourishes in low interest rate environments and serves as a hedge against economic and geopolitical uncertainties.
"Global trends will continue to play a big role and continue to move the gold market forward. The metal will grow gradually, showing stable growth values throughout the year," said Julia Khandoshko, CEO at broker Mind Money.
Spot silver fell 0.11% to $29.54 per ounce, platinum added 0.2% to $924.70, and palladium rose 0.2% to $912.69. All three metals were on track for weekly gains. - Reuters
