17.11.202309:08:00UTC+00Gold Set For Weekly Gain On Dovish Fed Bets

Gold prices rose on Friday and were set to log their first weekly gain in three amid bets that the U.S. Federal Reserve is done hiking interest rates and may announce two rate cuts next year to support growth.

Spot gold rose half a percent to $1,990.097 per ounce, while U.S. gold futures were up 0.3 percent at $1,994.05.

The dollar edged higher in early European trade but was set for a weekly loss as markets price in the possibility of a Fed rate cut in the first half of 2024.

The 10-year U.S. Treasury yield hovered near two-month lows after a string of weak economic data underscored the world's largest economy is slowing down.

A measure of U.S. jobless claims rose to a three-month high last week, retail sales fell for the first time in seven months in October and industrial production fell more than expected in the month, adding to expectations for Fed rate cuts.

Federal Reserve Governor Lisa Cook said Thursday that inflation can keep declining without a sharp spike in unemployment but warned that a "soft landing" for the U.S. economy "is not assured."

Separately, Cleveland Fed President Loretta Mester said it will take time for inflation to fully return to the central bank's 2 percent target.