NEW YORK/LONDON (Reuters) - Gold rose for a fourth consecutive session on Friday and posted its biggest weekly gain since late February, as disappointing U.S. growth and European debt jitters boosted investment demand for the precious metal.
Bullion buying accelerated after a report showed U.S. economic growth cooled in the first quarter as businesses cut back on investment.
Some safe-haven demand also supported prices after a credit downgrade of Spain’s sovereign debt by Standard & Poor’s.
Gold’s four-day rise was underpinned by option-related buying and after Federal Reserve Chairman Ben Bernanke said on Wednesday the U.S. central bank would not hesitate to launch another round of bond purchases to boost growth if necessary.
“The GDP data may confirm ongoing stimulatory U.S. monetary policies, which is positive for gold,” said James Steel, chief commodity analyst at HSBC.
Gold’s rise in the face of renewed Spanish debt fears was also seen as bullish, as the metal has tended to follow equities and riskier markets most of this year, Steel said.
Spot gold was up 0.4 percent at $1,663.11 an ounce by 2:51 p.m. EDT (1851 GMT).
For the week, bullion posted a 1.3 percent gain, the largest in eight weeks.
U.S. gold futures for June delivery settled up $4.30 at $1,664.80 an ounce. Trading volume was below 100,000 lots at 3 p.m., preliminary Reuters data showed, set to be one of the lowest turnovers for the year.
The precious metal has lost about $125 an ounce since the end of February after a string of encouraging U.S. economic indicators dashed hopes of further monetary easing by the Fed.
In addition, a lessening of fears about the European debt crisis prompted some funds to increase their bullish bets on riskier assets such as equities and reduce positions on gold.
For the year to date, gold has gained around 6 percent, underperforming an increase of about 12 percent in U.S. equities as measured by the S&P 500 index.
The metal stayed well within the narrow range it has stuck to this month, however, as a dearth of buying by key bullion consumer India curbed gains. <GOL/AS>
Among other precious metals, silver put on 0.7 percent at $31.30 an ounce.
Silver ended the week down 1 percent after sliding below $30 an ounce for the first time since mid-January on Wednesday. Prices fell in six of the previous eight weeks.
Retail demand disappointed after a brisk start to the year. U.S. American Eagle silver coins are on track to log their lowest monthly sales in April since July 2008, figures from the U.S. Mint showed.
Spot platinum gained 0.4 percent at $1,568.99 an ounce, while palladium was up 1.8 percent at $678.97.
Editing by Dale Hudson