PRECIOUS-Gold hits highest since May 1 on political uncertainty

    * U.S. economy grows 1.2 pct in first quarter -data
    * Silver, palladium see biggest weekly gains this month

 (Updates prices; adds comment, second byline, NEW YORK
    By Marcy Nicholson and Eric Onstad
    NEW YORK/LONDON, May 26 (Reuters) - Gold rose to its highest
in nearly four weeks on Friday as political uncertainty led
investors to favor bullion over assets considered riskier such
as stocks. 
    "We have had the political noise coming from Trump and the
U.S. administration and there is a certain element of
uncertainty in the markets in general, which is supporting gold.
Equities are also down," analyst Carsten Menke at Julius Baer in
Zurich said.
    Leaders of the world's rich nations face difficult talks
with Donald Trump at a G7 summit in Sicily on Friday after the
U.S. president lambasted NATO allies and condemned German trade
policies a day earlier.               
    Gold is often a favored investment during times of political
and financial uncertainty.
    Spot gold        gained 1.1 percent at $1,268.69 an ounce by
2:19 p.m. EDT (1819 GMT), the highest since May 1. It was on
track to close the week up around 1 percent, the third straight
week higher. U.S. gold futures         settled up 0.9 percent at
    Many traders will be away from their desks for an extended
Memorial Day holiday weekend in the United States and in
Britain, with many financial markets closed on Monday, when U.S.
gold futures will close early.             
    "We do expect a (U.S.) rate hike in June and we see the
dollar strengthening again," said Menke. "On the upside, there's
a lot of uncertainty, which keeps people from selling gold and
maybe causing a little bit of buying."
    Data on Friday showed U.S. gross domestic product grew at a
1.2 percent annual rate in the first quarter instead of the 0.7
percent pace reported last month, supporting the dollar.
    "Oddly enough, the gold price is holding more ground than
many traders may have expected on these positive economic
releases out of the U.S.A," said Miguel Perez-Santalla, vice
president of Heraeus Metal Management in New York.
    "Though technically, the precious metals market appears to
be strong, the positive economic view is likely to prevail at
some point against it."
    Among other precious metals, spot platinum        climbed
1.1 percent to $956.99, its highest in a month.
    Head of Technical Analysis Stéphanie Aymes at Societe
Generale said a bullish formation on the charts means platinum
is expected to head towards $991.
    Platinum is up 1.8 percent for the week. 
    Spot silver        rose 1.3 percent to $17.33 and was on
track to gain 3.1 percent this week, its biggest weekly rise
since mid-April. 
    Palladium        rose 2.2 percent to $788.10 and has added
3.8 percent this week, its first weekly gain this month.

 (Additional reporting by Vijaykumar Vedala in Bengaluru;
Editing by Bernadette Baum)