NEW YORK: Gold prices were on track for a second straight quarterly rise on Friday as growing bets that the US Federal Reserve will slow the pace of interest rate hikes drew investors to the metal.

Spot gold was down 0.2% at $1,977.32 per ounce by 12:15 p.m. EDT (1615 GMT), after prices moved as much as 0.4% higher following data that showed US consumer spending rose modestly in February. US gold futures fell about 0.1% to $1,977.80 .

“Gold jumped quickly but modestly after the market-friendly PCE (personal consumption expenditures) report,” said Tai Wong, an independent metals trader based in New York.

“Bulls want a very strong close, ideally above $2,000, for quarter-end as a springboard to challenge the $2,070 all-time record, but the yellow metal looks a little tired.” The dollar index, while down for the quarter, firmed on Friday, capping demand for greenback-priced gold.

Last week, gold topped $2,000 after the sudden collapse of two US regional lenders drove bets that the US central bank might pause interest rate hikes to stem the risk of contagion in the global banking system.

Prices retreated after authorities initiated rescue measures, though they have gained more than 8% so far this quarter.

“The mini-banking crisis has seen yields fall considerably and interest rate expectations pared significantly back, which has propelled gold higher,” said Craig Erlam, senior market analyst at OANDA.

“There’s likely to be significant scarring on the back of the issues in the banking sector which will slow the economy and enable central banks to do less, even cut rates this year,” he said.