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.

* Granite-Shares 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.

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