April 14 (Reuters) - Gold prices edged higher on Friday, set for a second consecutive weekly gain, as the U.S. dollar eased and recent economic data prompted bets that the Federal Reserve is nearing the end of its rate-hike cycle.
FUNDAMENTALS
* Spot gold was up 0.2% at $2,043.16 per ounce, as of 0044 GMT, hovering near a one-year high reached on Thursday. U.S. gold futures were unchanged at $2,054.60.
* The dollar index was 0.1% lower, making bullion cheaper for buyers holding other currencies.
* Data on Thursday showed U.S. producer prices unexpectedly fell by 0.5% in March, and there were signs that underlying producer inflation was subsiding.
* Moreover, the number of Americans filing new claims for unemployment benefits increased more than expected last week, a further sign that labour market conditions were loosening up as higher borrowing costs dampen demand in the economy.
* Data released on Wednesday showed that the U.S. Consumer Price Index rose 0.1% last month after advancing 0.4% in February.
* These economic readings, along with fears of a mild recession, have helped bullion gain about 1.7% so far in the week.
* The CME FedWatch tool shows markets are pricing in a 68.7% chance of a 25 basis-point hike in May, with rate cuts seen in the back half of the year.
* Gold is traditionally considered a hedge against inflation and economic uncertainties, but higher interest rates dim non-yielding bullion's appeal.
* Spot silver rose 0.2% to $25.85 per ounce, platinum added 0.5% at $1,052.59 and palladium gained 0.8% to $1,511.49.
DATA/EVENTS (GMT)
0645 France CPI (EU Norm) Final MM, YY March
1230 US Import Prices YY March
1230 US Retail Sales MM March
1315 US Industrial Production MM March
1400 US U Mich Sentiment Prelim April (Reporting by Kavya Guduru in Bengaluru; Editing by Subhranshu Sahu)
