US PPI data due at 1230 GMT
Silver, platinum head for weekly falls
Palladium up nearly 7 so far in the week

Oct 11 Reuters Gold prices climbed on Friday after recent data firmed bets for a Federal Reserve rate cut next month, while market participants awaited the U.S. Producer Price Index PPI report for further direction.

Spot gold rose 0.6 to 2,644.16 per ounce by 0514 GMT but was down about 0.3 for the week. Prices hit a record high of 2,685.42 last month.

U.S. gold futures gained 0.8 to 2,661.40.

The dollar index fell from a twomonth high, making bullion more attractive for other currency holders.

Data on Thursday showed that U.S. consumer prices rose slightly more than expected in September, while jobless claims increased to 258,000 in the week ended Oct. 5, versus estimates of 230,000. All eyes are now on the PPI data due at 1230 GMT.

Gold is seeing shortterm gains as recent data has been positive. If the PPI data comes in softer, gold39;s momentum could continue upward, said Kelvin Wong, OANDA39;s senior market analyst for Asia Pacific.

From a technical view point, in the nearterm, gold could retest 2,657 and if it breaks above that, then test levels near its alltime high.

Markets currently see an 84.4 chance of a 25basispoint rate reduction in November, compared with 76 before the data, and a 15.6 probability of the Fed keeping rates on hold, according to CME39;s FedWatch.

Lower interest rates reduce the opportunity cost of holding bullion….