LONDON (Reuters) - Gold was on track for a second weekly gain on Friday as concern about the ability of U.S. President Donald Trump to push legislation through Congress held the dollar near seven-week lows, making bullion cheaper for holders of other currencies.
Spot gold was up 0.2 at $1,247.65 an ounce at 1523 GMT. The metal has risen 1.6 percent this week and on Thursday touched $1,253.12, its highest since Feb. 28.
U.S. gold futures were flat at $1,247.60 an ounce.
Gold, seen as a safe haven asset, has benefited from falls in the dollar, U.S. bond yields and stocks this week as Trump’s difficulty in passing healthcare reform has undermined faith that he can deliver on promises of tax cuts and investment.
Trump has set up a showdown with lawmakers by demanding support for the healthcare bill in a vote on Friday.
“This is a key event not just for gold but for all risk assets,” said Robin Bhar at Societe Generale.
“We should see some safe haven flows into gold if he can’t get it passed because it means all his other programmes have a low probability of succeeding,” he said.
Failure to pass the bill could push gold through technical resistance at around $1,250, analysts said.
“If the market can consolidate above $1,250 in the coming days we could see an attempt at the 200-day moving average of $1,259.50,” Tim Brown at MKS PAMP wrote in a note.
Away from Congress, focus could move to the U.S. Federal Reserve. Three Fed officials, Charles Evans, James Bullard and William Dudley, were due to speak on Friday.
Gold prices have been supported by expectations that the Fed will raise interest rates more slowly than some had feared. Higher rates tend to pressure gold by lifting the opportunity cost of holding non-yielding bullion and boosting the dollar, in which gold is priced.
Bullard said on Friday that just one more rate hike this year would be appropriate following a rise earlier this month, but that he would not fight a second one. Dudley said that “delicate” policy changes were necessary.
Silver was up 0.7 percent at $17.67 an ounce. Platinum was 0.6 percent higher at $964.36 an ounce.
Palladium was up 1.6 percent at $812 an ounce, having hit a two-year high of $815.10 earlier in the session.
The metal used in catalytic converters that curb pollution from vehicle exhausts has risen 5.1 percent this week thanks to strong economic data and demand from the automobile sector.
Additional reporting by Nallur Sethuraman; Editing by Edmund Blair and Elaine Hardcastle