Feb 2 (Reuters) - Gold prices on Friday were set for
their best week in seven, as the dollar and Treasury yields
retreated, while traders awaited key U.S. jobs numbers due later
in the day to gauge timing on when the Federal Reserve could
start cutting interest rates.
    
    FUNDAMENTALS
    * Spot gold        was flat at $2,053.09 per ounce by 0211
GMT. Still, the contract has climbed 1.8% so far this week, set
for its best weekly gain since late-December, if gains hold.
    * U.S. gold futures         were flat at $2,070.30 per
ounce.
    * Spot gold rose nearly 1% on Thursday after data from the
U.S. Labor Department showed initial jobless claims rose more
than expected last week. 
    * A separate report showed that U.S. worker productivity
grew faster than expected in the fourth quarter.
    * Investor focus will shift to the U.S. non-farm payrolls
data due at 1330 GMT.
    * Bullion was also supported by concerns over the regional
banking sector in the U.S., increasing appeal for safe-haven
assets such as bullion and Treasury bonds.            
    * Yields on benchmark 10-year Treasury notes            ,
which are inversely related to bond prices, languished near
their lowest levels seen in 2024.      
    * The dollar index        fell 0.4% so far this week.       
    * The U.S. Fed pushed back on the idea of an interest rate
cut in the spring, but expressed confidence in inflation moving
towards the desired 2% range, while doing away with a
long-standing reference to possible further hikes.
    * Money market pricing shows traders are nothing but sure
about a rate cut in May, according to LSEG's interest rate
probability app IRPR.           
    * Lower interest rates boost non-yielding bullion's appeal. 
  
    * Spot silver        fell 0.3% to $23.10 per ounce, platinum
       shed 0.5% to $908.55, while palladium        edged 0.1%
higher to $962.91.
    
DATA/EVENTS (GMT)
0745  France  Industrial Output MM    Dec
1330  US      Non-Farm Payrolls       Jan
1500  US      Factory Orders MM       Dec
1500  US      U Mich Sentiment Final  Dec

    

 (Reporting by Daksh Grover and Harshit Verma in Bengaluru;
Editing by Sherry Jacob-Phillips)