Gold prices headed for their best week in a year on Friday, supported by safe-haven demand due to the escalating war between Russia and Ukraine, as investors weighed the outlook for reduction in interest rates in the United States.
Spot gold rose 0.7% to $2,688.70 an ounce by 0306 GMT. Bullion is up almost 5% for the week so far, its best week since early October 2023.
U.S. gold futures gained 0.6% to $2,691.00.
Gold is drawing support from bitcoin's push toward $100,000, escalations between Russia and Ukraine and the risk of renewed conflict, said Edward Meir, an analyst at Marex.
Bitcoin has surged more than 40% since this month's U.S. election as President-elect Trump is expected to ease regulations on cryptocurrencies.
Russia launched a hypersonic missile at Dnipro on Thursday, escalating the war, after the United States and the United Kingdom approved kyiv's use of advanced Western weapons to strike Russian territory.
Gold's appeal is heightened by geopolitical tensions, economic risks and low interest rates.
Meanwhile, the president of the Chicago Federal Reserve on Thursday reiterated his support for further cuts in U.S. interest rates and his openness to a slowdown in those cuts.
Markets are pricing in a 55.9% chance of a 25 basis point cut at the December Fed meeting, according to the CME's Fedwatch tool.
Investors will watch U.S. consumer sentiment data (final), due at 0300 GMT, as well as remarks from Fed Governor Michelle Bowman for more clues on the prospects for interest rate cuts.
Gold's near-term movement could be influenced by next week's key US data, such as preliminary GDP and core PCE, with prices expected to target $2,690-$2,715 based on recent trends , said Nicholas Frappell, global head of institutional markets at ABC Refinery.
On Friday, spot silver rose 0.6% to $30.97 an ounce, platinum rose 0.6% to $966.14 and palladium rose 1.1% to reach $1,040.58. All three metals were on track for weekly gains.
