Gold reclaims $1,800/oz mark as inflation worries boost appeal

GOLD - Gold prices rose above the key $1,800 per ounce level on Friday as a weaker dollar and worries about rising inflation bolstered demand for the safe-haven asset, keeping the metal on track to post its best week since May.

Spot gold jumped 1.4% to $1,807.57 per ounce by 10:07 a.m. ET (1407 GMT). Prices are up more than 2% for the week.

U.S. gold futures for December delivery rose 1.6% to $1,810.20.

The dollar index headed for a second week of declines, lending support to gold by making it more attractive for buyers holding other currencies.

"Inflation is the one thing that everybody is talking about today," said Daniel Pavilonis, senior market strategist at RJO Futures.

"The perception is that the Federal Reserve is behind the curve, and the metals market is looking at that as the Fed is not going to do enough to slow inflation... that is where gold is going to find its value."

Some investors view gold as a hedge against higher inflation that could follow stimulus measures.

Atlanta U.S Fed President Raphael Bostic said he expects high inflation to persist into 2022 and the central bank to raise interest rates by the end of next year.

Focus will now be on Fed Chair Jerome Powell's comments in a panel discussion on Friday.

Elsewhere, euro zone inflation expectations hit their highest levels in years, putting additional pressure on the European Central Bank and its insistence on maintaining crisis-era stimulus.

Silver gained 2.3% at $24.70 per ounce after hitting a one-and-a-half month high earlier in the session.

Platinum climbed 1.9% to $1,068.58, heading for its third straight weekly rise.

"In 2022, we expect platinum to emerge from its current fragility, driven by the chip shortage, into a more supportive price environment thanks to improving demand," UBS analysts said in a note.

Palladium rose 0.3% to $2,025.18 per ounce.