PRECIOUS-Gold set for seventh weekly gain as trade war risks lift demand

Adds graphics, updates with mid-session trading

By Anushree Mukherjee

Feb 14 (Reuters) - Gold prices gained on Friday and were poised for a seventh consecutive weekly gain, as U.S. President Donald Trump's plans to impose reciprocal tariffs on every country taxing U.S. imports fuelled concerns of a global trade war.

Spot gold XAU= was up 0.1% at $2,932.81 per ounce, as of 0706 GMT, moving closer to its record peak of $2,942.70 hit on Tuesday.

U.S. gold futures GCcv1 rose 0.5% to $2,960.40.

Trump tasked his economics team on Thursday with devising plans for reciprocal tariffs on every country taxing U.S. imports, and the targets include China, Japan, South Korea and the European Union.

A major trigger for gold prices this week was Trump's announcement to impose reciprocal tariffs, which is creating tariff war concerns and could impact global economies, said Ajay Kedia, director at Mumbai-based Kedia Commodities.

The market is slightly overbought, which can create some technical profit booking after nearing the $3,000 level, Kedia said.

Meanwhile, data on Thursday showed the U.S. producer price index (PPI) saw a strong increase in January, following Wednesday's inflation report that revealed consumer prices had risen at the fastest pace in nearly a year and a half.

The PPI data offered more evidence that inflation was accelerating again and strengthened views that the Federal Reserve would not cut interest rates before the second half of the year.

Bullion is traditionally viewed as a safe haven against inflation and economic uncertainty, but the appeal of this non-yielding asset diminishes with rising interest rates.

U.S.-China trade breakthrough, de-escalation in Russia-Ukraine or Israel-Hamas conflicts, or strong U.S. data that takes Fed rate cuts off the table for this year are possible reasons for gold prices to drop and all seem to be unlikely in the near term, said Ilya Spivak, head of global macro at Tastylive.

Spot silver XAG= gained 1.9% to $32.97 per ounce. Platinum XPT= was up 0.8% at $1,002.95 and palladium XPD= rose 0.7% to $1,000.82. All three metals were on track for a weekly gain.