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By Bloomberg

Gold advanced to pare a weekly loss before a U.S. report on consumer prices that may help investors gauge when the Federal Reserve will start to raise interest rates for the first time since 2006.

Bullion for immediate delivery rose as much as 0.4 percent to $1,203.02 an ounce and was at $1,200.83 by 3:03 p.m. in Singapore, according to Bloomberg generic pricing. The metal is set to decline 0.6 percent this week, the first loss since the period ended March 13. Gold in Shanghai retreated.

Traders are poring over data for clues on whether the economy has enough momentum to warrant a rise in borrowing costs. Higher rates diminish the allure of gold, which generally gives returns only through price gains, spurring investors to favor assets with better yield prospects such as equities. The U.S. reports consumer prices on Friday after figures on Thursday showed housing starts rose less than forecast and economic conditions in Philadelphia improved.

“It appears that gold’s only interest now is to continue hovering around $1,200 as it awaits the FOMC meeting at the end of this month,” Howie Lee, an investment analyst at Phillip Futures Pte in Singapore, wrote in a note. “Officials were also in public debate yesterday, with most suggesting that they continue to be data-dependent.”

Work began on 926,000 houses at an annualized rate, up 2 percent from February when bad winter weather prompted a 15.3 percent plunge, Commerce Department figures showed. Starts in March were less than the most pessimistic estimate in a Bloomberg survey. Conditions in the Philadelphia region improved more than estimated, a separate report showed. The Fed next meets April 28-29.

Weak Data

Data on Friday may show consumer prices rose in March from a month earlier, according to a Bloomberg survey of economists. Fed Vice Chairman Stanley Fischer said on Thursday that he expects the economy to rebound after a soft first quarter. Atlanta Fed President Dennis Lockhart and Boston Fed chief Eric Rosengren said in separate speeches the recent spate of weak data made them more wary of tightening too soon.

Gold for June delivery increased 0.3 percent to $1,201.60 on the Comex, down 0.2 percent this week. Bullion of 99.99 percent purity lost 0.3 percent to 239.62 yuan a gram ($1,203.46 an ounce) on the Shanghai Gold Exchange.

Silver for immediate delivery was 0.2 percent higher at $16.324 an ounce, trimming a second weekly decline. Platinum rose 0.2 percent to $1,162.37 an ounce and is 0.8 percent lower this week. Palladium was little changed at $781.18 an ounce. Prices are set to advance for a third week, the longest rally since July.