Gold set for biggest weekly drop in 2 months

LONDON: Gold edged higher on Friday after two days of losses but remained on track for its biggest weekly slide in nearly two months on growing expectations for an increase in US interest rates as soon as next month.
Spot gold was up 0.2 percent at $1,257.11 an ounce at 1345 GMT, while US gold futures for June delivery were up $3.30 at $1,258.10. Spot prices are down 1.5 percent this week and facing a third straight week of losses.
Among other precious metals, silver was up 0.6 percent at $16.57, while platinum was up 1.5 percent at $1,024.40 and palladium 2.1 percent higher at $566.10.
Palladium was the biggest faller of the week, down 4.7 percent.
Gold demand in Asia was subdued this week by a firmer dollar and weak seasonal demand.
New York Fed President William Dudley said on Thursday there was a strong sense among central bank officials that markets were underestimating the probability of policy tightening. That came a day after the minutes of the Fed’s April meeting. revealed that most policymakers felt a rate increase might be appropriate as early as next month, sending gold to a three-week low of $1,244.