Gold Refinery gold shavings. Picture: AFP PHOTO/OZAN KOSE
Gold Refinery gold shavings. Picture: AFP PHOTO/OZAN KOSE

Bengaluru — Gold prices steadied on Friday, but remained on course for their biggest weekly gain since March 2018, after rising expectations for a US rate cut and concerns over trade tussles boosted demand for safe-haven bullion.

However, having failed earlier this week to breach its 2019 high of $1,346.73, analysts expect the metal to consolidate until there is fresh impetus.

Spot gold was steady at $1,335.35 per ounce at 11.53 GMT, while US gold futures were down 0.2% at $1,339.60.

"We have had quite a move higher earlier this week, but we are moving towards levels where the market will struggle to go much higher," ING analyst Warren Patterson said. Gold has rallied in a short span of time, having gained about 2.3% this week.

"Overall sentiment is still fairly supportive for the gold market," Patterson added, attributing the recent rally to a two-pronged US trade spat with Mexico and China, and hopes for an interest-rate cut by the US Federal Reserve.

The US and Mexico concluded their second day of talks on trade and migration on Thursday and markets rebounded on optimism a deal could be close. However, it remains unclear whether Mexican pledges to curb migration flows will be enough to persuade Washington to postpone tariffs.

US President Donald Trump said he would decide whether to carry out his threat to hit Beijing with tariffs on at least $300bn in Chinese goods after a meeting of leaders of the world's largest economies late this month.

Gold's appeal as a safe-haven investment is bolstered in times of geopolitical uncertainty.

"Gold is likely to stay muted through the rest of the day before the release of the non-farm payrolls. Investors want to see the impact on the U.S. jobs market before reassessing the current pessimism," Howie Lee, an economist at OCBC Bank, said. U.S. non-farm payrolls data at 1230 GMT will provide clues on the trajectory of interest rates.

Meanwhile, New York Fed President John Williams on Thursday acknowledged the impact of trade and global growth concerns on business investment, but said he was keeping an open mind on interest rates.

Among other metals, silver rose 0.4% to $14.91 per ounce, on track for its biggest weekly increase since late January. Platinum edged 0.2% lower to $801.40 an ounce. The metal was still headed for its first weekly gain in seven. Palladium dipped 0.2% to $1,348.65 an ounce.