Bullion continued its high momentum throughout the week above the $4,900 level even though market risk appetite recovered and tensions between the United States and Europe began to ease following the agreement on Greenland.
At 9.20 am, the price of gold was at $4,943, up 0.14% since it opened in early trading on Friday in the Asian session.
The market mood became more positive following the conversation between United States President Donald Trump and NATO Secretary General Mark Rutte, which took place in Switzerland.
The outcome of the meeting saw Trump drop the threat of tariffs on eight European countries that were previously scheduled to take effect on February 1.
In addition to geopolitical factors, market sentiment was also supported by the stronger-than-expected performance of the United States economy.
Third-quarter Gross Domestic Product (GDP) data recorded readings that exceeded market estimates, while the labor market remained stable with no signs of significant weakness, in line with the assessment of Federal Reserve (Fed) officials.
This has led to the market fully pricing in the Fed's expected rate cut at its January 27-28 meeting.
Additional data showed the Fed's preferred inflation gauge remained stable, but still above the central bank's long-term target of 2 percent.
Overall, money markets still expect around 41 basis points of monetary easing by year-end, according to Prime Market Terminal data.
However, following the release of better-than-expected economic data, traders continued to reduce bets on a more aggressive rate cut by the Fed.
