BENGALURU (Sept 1): Gold prices held steady on Friday near 9-1/2 month highs touched earlier this week as simmering tensions over the Korean peninsula fuelled safe haven demand.

FUNDAMENTALS

* Spot gold was little changed at $1,321.20 per ounce as of 0022 GMT and was on track for a weekly gain of more than 2 percent. U.S. gold futures for December delivery were up 0.4 percent at $1,326.80.

* U.S. consumer spending rose slightly less than expected in July and annual inflation advanced at its slowest pace in more than 1-1/2 years, diminishing expectations of an interest rate increase in December.             

* The dollar surrendered early gains against a basket of major currencies, pressured by simmering tensions on the Korean peninsula.                   

* Investors are awaiting a monthly U.S. payrolls report to be released on Friday.

* South Korean and Japanese jets joined exercises with two supersonic U.S. B-1B bombers above and near the Korean peninsula on Thursday, two days after North Korea sharply raised tension by firing a missile over Japan.             

* The United States has told Russia to close its consulate in San Francisco and buildings in Washington and New York that house trade missions, the State Department said on Thursday, in retaliation for Moscow cutting the U.S. diplomatic presence in Russia.             

* U.S. Treasury Secretary Steven Mnuchin said on Thursday that Hurricane Harvey could bring forward the deadline by which the nation's debt ceiling needs to be raised and that he is open to the borrowing cap being dealt with as part of a wider bill.

* GraniteShares Gold Trust, an exchange-traded fund (ETF), began trading on Aug. 31.             

* The U.S. Mint sold 9,500 ounces of American Eagle gold coins in August, down 42.4 percent from the previous month.

* Greece plans to start an arbitration process next month to settle its differences with Canada's Eldorado Gold Corp over its gold mine development plans in northern Greece.