LONDON: Gold prices firmed on Friday, tracking gains in equities and other commodities as encouraging data from China and the United States boosted optimism over the outlook for global economic growth. World shares hit a 20-month high on Friday after a report showed China's economy grew at a slightly faster-than-expected 7.9 per cent in the fourth quarter of 2012, following strong US labour and housing market reports on Thursday. That lifted copper and palladium, and underpinned crude oil. "Gold is rallying along with other commodities and other precious metals, with stronger risk appetite luring some speculative investment into the yellow metal's market," Commerzbank analyst Carsten Fritch said. Spot gold was up 0.2 per cent to $1,690.86 an ounce at 1136 GMT, heading for a weekly rise of 1.7 per cent, its biggest in nearly two months. It hit a one-month high of $1,695.56 on Thursday. US gold futures for December delivery were little changed at $1,690.60. Prices are hovering just below their 50-day moving average at $1,696, which represents a technical resistance level, according to analysts who study past price patterns to determine the future direction of trade. Analysts said the metal is also likely to track movements in the dollar, with data such as the US University of Michigan consumer confidence index and quarterly earning results from bellwether General Electric and Morgan Stanley likely to impact trade later in the day. Some volatility was also possible as the week draws to a close, traders said. "I think today will be another choppy Friday for gold, as it has been over the past three weeks. We may see some profit-taking along the way and some long liquidation ahead of the weekend," Bernard Sin, senior vice president at MKS Finance, said. In the longer term, expectations that the US Federal Reserve would continue its monetary stimulus and concerns about US fiscal conditions will keep gold attractive as a hedge against inflation and uncertainty, market participants said. Physical buying interest picked up in some markets, according to analysts and traders. "The physical market is off to a good start this year, with many indicators so far pointing to a positive demand story," UBS said. "The loco swap rate between Zurich and London is now firmly in positive territory, suggesting strong physical offtake and subdued scrap supply." Benchmark gold on the Tokyo Commodity Exchange hit a record high of 4,911 yen a gram as yen dropped to a 2-1/2-year low against the dollar. PGMs EASE FROM MULTI-MONTH HIGHS Platinum edged lower as investors cashed in gains after its rally to multi-month highs this week. Spot platinum inched down 0.1 per cent to $1,687.50, but stayed on course to rise for a third week, by 3.6 per cent. Spot palladium was flat at $722.72 an ounce, having earlier hit a 16-month high of $730.47. Platinum group metals are solidly underpinned by threats to South African supply and positive Chinese and US data, which supported expectations that demand from carmakers, the biggest consumers of the platinum group metals, will improve. Platinum hit a three-month high of $1,701.50 on Thursday after gaining strongly throughout the week on supply concerns from leading producer South Africa, where number one platinum miner Anglo American Platinum announced cutbacks. "The market seems to have discounted the impact of the Amplats' announcement," MKS Finance's Sin said. Spot silver rose to a one-month high of $31.91, on course for a 4.5 per cent weekly gain. It was last seen at $31.80, up 0.3 per cent. The US Mint suspended sales of its 2013 American Eagle silver bullion coins after running out of stock due to soaring investor demand for the newly minted coins in the first two weeks of the year until the week of January 28.

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