Gold prices rose Friday, holding close to record highs hit earlier this week, as signs of a weakening U.S. labor market reinforced expectations the Federal Reserve will deliver its first rate cut of the year next week.

Spot gold was up 0.4% at $3,649.54 per ounce, as of 09:19 a.m. EDT (1319 GMT), remaining close to Tuesday's all-time high of $3,673.95. The metal has gained 1.8% so far this week and is poised for a fourth consecutive weekly advance.

U.S. gold futures for December delivery were up 0.4% at $3,688.10.

"Weaker employment and spotty inflation... priced in with the Fed having to cut rates is pushing metals higher because there is the risk of longer-term inflation," said Daniel Pavilonis, senior market strategist at RJO Futures.

Recent data showing jobless claims surged last week, even as consumer prices posted their sharpest monthly increase in seven months in August, has boosted the shift in rate expectations. Investors, however, are prioritizing signs of labor market weakness over sticky inflation in shaping rate expectations.

Fed fund futures fully price in a 25-basis-point cut at the Fed's September 17 meeting, though expectations for a larger 50-bps move have eased.

"Given these tailwinds and following the recent step higher in exchange-traded fund flows (ETFs), we now look for gold to rise to $3,900/oz by mid next year," said UBS analyst Giovanni Staunovo.

The yellow metal has risen 39% so far this year and is often seen as thriving in lower-rate settings, valued by investors as a hedge against inflation and broader uncertainty.

Meanwhile, China's central bank on Friday sought public feedback on plans to simplify gold import and export rules by streamlining licensing.

Elsewhere, spot silver rose 1.3% to $42.08 per ounce, at a 14-year high, platinum was up 1.4% at $1,397.61 and palladium gained 2.2% to $1,214.70. All three metals were set for weekly gains.