*

Bullion up about 1.6% so far this week

*

Silver, palladium and platinum on track of weekly gains

*

Gold expected to grow gradually in 2025 - analyst

(Updates with mid-session trading)

By Daksh Grover

Jan 3 (Reuters) - Gold edged up on Friday on a softer

U.S. dollar and safe haven flows, with the metal en-route for a

weekly gain as attention turned to U.S. President-elect Donald

Trump's proposed policy changes that could influence the

economic and interest rate outlook going forward.

Spot gold was up 0.2% at $2,661.19 per ounce, as of

0257 GMT, hitting its highest level since Dec. 13. Bullion is up

about 1.6% for the week so far.

U.S. gold futures rose 0.2% to $2,675.40.

The dollar index fell 0.2%, making dollar-priced

bullion more affordable for holders of other currencies.

"We have seen an uptick in safe haven flows, which has been

to the benefit of gold," said Tim Waterer, chief market analyst

at KCM Trade.

"Any pullback in the U.S. dollar could prove to be a

catalyst for gold to breakout higher."

Trump's inauguration on Jan. 20 has heightened uncertainty,

with his proposed tariffs and protectionist policies expected to

be inflationary and potentially spark trade wars.

On the geopolitical front, Israeli airstrikes killed at

least 68 Palestinians in Gaza.

Additionally, Russia launched a drone strike on the

Ukrainian capital Kyiv on Wednesday, causing damage in at least

two districts.

Gold flourishes in low interest rate environments and serves

as a hedge against economic and geopolitical uncertainties.

Last month, the U.S. central bank delivered a third

consecutive rate cut, but now projects only two reductions in

2025.

Markets now await U.S. job openings data, the ADP employment

report, Fed meeting minutes, and the employment report, all due

next week, for further direction.

"Global trends will continue to play a big role and continue

to move the gold market forward. The metal will grow gradually,

showing stable growth values throughout the year," said Julia

Khandoshko, CEO at broker Mind Money.

Spot silver was steady at $29.58 per ounce, platinum

added 0.4% to $926.95, and palladium rose 0.2% to

$913.18. All three metals were on track of weekly gains.