NEW YORK: Gold prices climbed more than 1% on Friday to an over one-week high, as a weaker dollar boosted demand for the yellow metal, even as US Federal Reserve policymakers vowed to raise interest rates to tame inflation pressures. Spot gold was up 0.7% at $1,719.89 per ounce by 1230 GMT after rising to its highest since Aug 30 at $1,729.29 earlier in the session. Bullion, up 0.5% so far this week, was heading for its first weekly gain in four.

US gold futures rose 0.6% to $1,730.90.

“The US dollar index dropping back to a one-week low has boosted the price of gold, and there may well be further strength into the inflation report and perhaps even beyond that,” David Jones, chief market strategist at Capital.com said.

The dollar dropped over 1%, making greenback-priced bullion less expensive for overseas buyers, while the benchmark 10-year US Treasury yields also pulled back from recent highs.