Gold prices jumped more than 1% on Friday and were set for their first weekly gain in four helped by a sliding dollar despite looming aggressive rate hikes by the U.S. Federal Reserve.

Spot gold rose 1.1% to $1,726.06 per ounce by 0755 GMT. Prices were up 0.9% so far for the week.

U.S. gold futures gained 1% to $1,737.90. "With other major central banks also opting for super-sized interest rates, the dollar index will cool off a bit and lead to more safe-haven and investment demand for gold," said Sugandha Sachdeva, vice president of commodity and currency research at Religare Broking.

"We are not very bullish on gold prices in the rising interest rate environment but we do see a bounce back towards the $1,770 level."

The dollar index was down 0.9%, hitting its lowest level in more than week, making greenback-priced bullion less expensive for overseas buyers.

The European Central Bank raised its key rates by an unprecedented 75 basis points (bps) on Thursday and promised further hikes to rein in inflation, boosting the euro.

The U.S. CPI data is going to be the next major catalyst for gold and "a big focus will be does it encourage the Fed further," said DailyFX currency strategist Ilya Spivak.

The Fed is "strongly committed" to fighting inflation and remains hopeful that can be done without the "very high social costs" involved in prior campaigns to control surging prices, Fed Chair Jerome Powell said on Thursday.

Markets are pricing in an 87% chance of a 75 bps hike this month. Higher interest rates increase the opportunity cost of holding non-yielding bullion and boost the dollar.

Spot silver rose 1.4% to $18.83 per ounce and was up 4.7% on the week.

Platinum added 0.4% to $882.49 and was headed for its biggest weekly gain since June.

Palladium rose 0.4% to $2,147 and was set for its biggest weekly gain since July.

(Reporting by Eileen Soreng in Bengaluru; editing by Rashmi Aich and Jason Neely)