Gold prices steadied on Friday, and were set to end the week largely unchanged as selling pressure from a hawkish Federal Reserve appeared to have eased.

Bullion prices showed surprising resilience this week after the Fed hiked rates and struck a more hawkish tone than many were expecting, with U.S. interest rates now set to end the year well above 4%,

But prices of the yellow metal were still trading well below $1,700- a key support level they lost this week. This also spurred some bargain hunting for gold.

Spot gold was largely unchanged around $1,672.37 an ounce, while gold futures held around $1,680 an ounce at 19:40 ET (23:40 GMT). Resilience in prices also came as the dollar retreated slightly from a fresh 20-year peak hit on Thursday.

The near-term outlook for gold is still constrained by the prospect of rising U.S. interest rates, which boosted the dollar and dragged bullion prices off record highs this year.

But expectations of more economic ructions from the Fed’s hawkish moves have raised expectations that the yellow metal may eventually regain its safe haven status. Traders are also pricing in the possibility that the Fed will begin cutting rates in late-2023 to prevent broader economic shocks from high rates.

“The hawkish Fed projections are a rather grim outlook for the economy and that could eventually trigger a resumption of a safe-haven role for gold. ​This inflation fight is going to get ugly for the economy, but right now it seems the Fed will be done hiking in February,” analysts at Oanda wrote in a note this week. They also indicated that gold may have found a bottom.

Among industrial metals, copper futures rose 0.2% to $3.4690 a pound on Friday.

Prices of the red metal were set to end the week 1.4% lower, down for a second consecutive week as traders feared that rising interest rates across the globe would weigh on industrial activity.

Apart from the Fed, the Bank of England also hiked rates this week to combat rising inflation, as did central banks in Europe and Asia.