Gold prices edged higher on Friday and were set for a weekly gain, driven by recent reports of top consumer China resuming gold purchases, and heightened expectations of an interest rate reduction by the Federal Reserve at its Dec.

Gold futures fell more than 1% on Friday but still posted a modest gain for the week with expectations running high for a Federal Reserve rate cut next week at the central bank's policy meeting, with traders now forecasting a 97% chance of a 25-bp cut.