Gold braced for its biggest weekly gain in two months on Friday, as a rising euro pushed the U.S. dollar to its weakest since June 2016, making bullion cheaper for holders of other currencies.
Bond yields also fell after European Central Bank President Mario Draghi said on Thursday the ECB was in no rush to scale back its asset purchase program. Lower yields help gold prices by reducing the opportunity cost of holding non-yielding bullion.
As morning became afternoon on the east coast, spot gold was up 0.6% at $1,251.15 U.S. an ounce, the highest since June 29, and crossing its 50-day moving average of $1,249.30 U.S. for the first time since June 15. It was trending toward a weekly gain of 1.6%.
Experts have also said, though, expected interest rate rises by the U.S. Federal Reserve would limit gains and it would remain in a $1,200-$1,250 range. Gold is highly sensitive to rising interest rates because they cause bond yields to rise and tend to boost the dollar. The Fed's rate-setting committee is due to meet next week.
Among other precious metals, silver was up 1.2% at $16.48 U.S. an ounce, the highest since July 3. Silver has risen 3.1% this week.
Platinum was 0.6% higher at $932.25 U.S. an ounce and on track for a weekly gain of around 2%.
Palladium was up 1% at $851.25 U.S. an ounce, but set for a weekly fall of around 1%.
