Gold records largest weekly loss in a month and a half

Gold posted its largest weekly loss in six weeks on Friday, as escalating exchanges of strikes between the United States and Iran drove up oil prices, heightening inflationary pressures and boosting the likelihood of a U.S. interest rate hike.

Spot gold rose 0.5 percent to $3,988.20 per ounce by 0313 GMT, after earlier hitting its lowest level since July 1.

U.S. gold futures for August delivery settled at $3,992. Nevertheless, the yellow metal fell 3.2 percent since the start of the week, marking its biggest decline since early June, as the impact of Middle East tensions outweighed support from U.S. June inflation data released this week, which came in below expectations.