Gold rose 1.5% Friday, lifted by sharp rallies in equities and commodities after data showed that China's economic growth, though slower, was stronger than expected.
The precious metal was on track to post a weekly gain following Friday's rally.
China, considered an engine of the global economy, said its year-on-year growth was 7.6% in the second quarter, below the 8% level that in previous downturns has triggered a robust response from policymakers.
Its growth rate slowed for a sixth successive quarter to its weakest pace in more than three years, but economists had anticipated much worse because of signs of a slowdown in the U.S. and Europe.
Bullion, which has been particularly sensitive to central banks' monetary policies, also received a boost from perceptions that the Chinese GDP data could open the door for further easing.
"It does indicate that the People's Bank of China has to promote more liquidity via further rate cuts or potential fiscal programs that make sure growth does not fall below these levels," said Mark Luschini, chief investment strategist at broker-dealer Janney Montgomery Scott, which has $54 billion in assets.
August gold shot up $27.40 an ounce to $1,592.70. The pace of trading was slightly slower than usual.
A 1.5% rally on Wall Street and sharp gains in crude oil and grains amid a weaker dollar also lifted gold, which has largely moved in tandem with the perceived riskier assets this year.
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