By Sumita Layek
(Reuters) - Gold rose on Friday as a gloomy global economic outlook dented risk appetite, but a firm dollar stemmed bullion's advance and kept the metal on track for its first weekly decline in three.
Spot gold was up 0.3 percent at $1,313.74 per ounce at 11:25 am EST (1625 GMT), having recovered from the more than one-week low of $1,302.11 touched on Thursday.
U.S. gold futures were also up 0.3 percent at $1,317.90.
"With equities a little lower here, we're getting some flight to safety in gold," said Bob Haberkorn, senior market strategist at RJO Futures.
"The fact that the U.S. economy is not seeing weak data like the euro zone is supportive of the dollar. If the dollar was a little weaker today, gold would probably be up $7 or $8, instead of $3."
Stocks fell worldwide for a third straight day on worries about a global slowdown and the lack of any sign of a resolution to the U.S.-China trade row.
In the latest on the trade conflict between the world's two biggest economies, U.S. President Donald Trump said he did not plan to meet with Chinese President Xi Jinping before a March 1 deadline for a deal.
However, while bullion has risen about 13 percent from 1-1/2-year lows touched in August, mostly because of volatile stock markets and a dovish U.S. Federal Reserve, a strong dollar has driven gold down about 0.3 percent so far this week.
The greenback held firm versus a basket of other currencies, on track for its best week in six months.
Adding to worries about a global slowdown, the European Commission cut its forecasts for euro zone economic growth, citing trade tensions and China's slowdown. A logjam in Washington over a border wall with Mexico also played on investors' minds.
Gold is considered a safe store of value during economic and political uncertainty.
However, gold's recent gains have failed to translate into inflows for the world's largest gold-backed exchange-traded fund, the SPDR Gold Trust. Holdings in the fund have fallen more than 1 percent for the week.
"We see no reason for the outflows in view of the falling stock markets and declining bond yields, however. We believe gold should be in good demand as an attractive alternative investment and a safe haven, partly because there are after all numerous political risks," Commerzbank said in a note.
Meanwhile, palladium rose 0.5 percent to $1,391.45 an ounce.
Spot silver gained 0.1 percent to $15.72, while platinum was up 0.3 percent at $793.39
(Reporting by Sumita Layek and K. Sathya Narayanan in Bengaluru; Editing by Steve Orlofsky)
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)