* U.S. July consumer prices rise less than expected
* Platinum hits five-month high
* Silver on track for biggest weekly gain since July 2016
(Updates prices; adds comment, NEW YORK dateline, byline)
By Marcy Nicholson and Zandi Shabalala
NEW YORK/JOHANNESBURG, Aug 11 (Reuters) - Gold prices
climbed to two-month highs on Friday, rising for the fourth
straight day as investors sought refuge amid escalating tensions
between North Korea and the United States, while bullion also
received support from weak U.S. inflation data.
U.S. President Donald Trump issued a new threat to North
Korea on Friday, saying the U.S. military was "locked and
loaded" as Pyongyang accused him of driving the Korean Peninsula
to the brink of nuclear war and world powers expressed alarm.
Spot gold was up 0.2 percent at $1,287.91 an ounce by
2:03 p.m. EDT (1803 GMT), and set for its biggest weekly gain
since mid-April. It earlier hit $1,291.86, its highest level
since June 7.
U.S. gold futures settled up 0.3 percent at $1,294.
"There is a continuation of flight to the safe havens after
remarks on Thursday evening from Trump about North Korea," said
Quantitative Commodity Research consultant Peter Fertig. "It's
not very likely that these tensions will ease in the near future
so the outlook seems supportive for gold."
Geopolitical risks can boost demand for assets considered
safe-haven investments, such as gold.
"There remains huge uncertainty as to how the current
geopolitical crisis will play out and this may support gold
prices over the coming weeks," said Capital Economics in a
research note.
"On the other hand, if Trump's threats prove to be nothing
more than inflammatory rhetoric – as on previous occasions – we
would not be surprised to see the gold price retreat as the
focus of investors returns to Fed tightening."
Data on Friday showed U.S. consumer prices rose less than
expected in July, which was also supportive to gold.
"If you look at the gold price after the CPI (inflation)
data, it tells you that the Fed is not going to be in any rush
to increase the interest rate this year," said Naeem Aslam,
chief market analyst at Think Markets. "The level which we are
looking at now is $1,300."
The dollar index dipped to a one-week low after the
data.
Silver was up 0.2 percent to $17.10 per ounce after
hitting $17.24, its highest since June 14, in the previous
session. It was on course for a weekly rise of 5.3 percent, the
biggest such gain since July 2016.
Platinum climbed 1 percent to $986.20 per ounce after
touching $991.50, its highest since March 6. It had gained about
2.8 percent for the week so far.
Palladium was flat at $896.50 per ounce and was on
track to end the week about 2 percent higher.
(Additional reporting by Eric Onstad in London, and Nithin
Prasad and Arpan Varghese in Bengaluru; editing by Dale Hudson
and G Crosse)