LONDON — Gold eased on Friday after soaring 4% the previous day, but was still set for its best week in four years, lifted by stock market turmoil that has sent investors rushing for safe haven assets.

Spot gold was down 1% at $1,234.30 an ounce by 2.23pm GMT, but has still risen more than 5% this week, the biggest weekly gain since October 2011.

"Gold could test $1,260 or even $1,300 in the next few weeks, but I wouldn’t be surprised if we also see some profit-taking," said Commerzbank analyst Carsten Fritsch.

Prices fell on Friday as the dollar extended gains after better than expected US retail sales data.

Prices hit a one-year high of $1,260.60 on Thursday.

The precious metal has benefited, along with bonds and the Japanese yen, from a rush to safety as investors worry about the health of some banks, financial instability and the potential for global recession.

They have been unnerved since the Bank of Japan, followed by Sweden this week, introduced negative interest rates to try to stimulate growth.

Gold has also been boosted by a scaling back of expectations for US interest rate rises and even the possibility of rate cuts if economic conditions deteriorate.

"The sharp repricing of risk assets lower over the past week, has led to more outflows from credit and now equity funds," Bank of America Merrill Lynch said in a note.

"Money market, government bonds and gold funds have been the main beneficiaries of the recent turmoil." US Federal Reserve Bank of New York President William Dudley is due to speak at 3pm GMT on Friday and investors will be watching for signals on the outlook for monetary policy.

Safe-haven assets have shone across the board in the past few days as equities plunged. US 10-year Treasury yields hit their lowest since 2012 and the Japanese yen climbed to its highest in 15 months against the dollar, while money continued to flow into gold-backed exchange-traded funds.

US gold futures have risen more than 7% for the week, the sharpest jump since 2008.

SPDR Gold Trust GLD, the world’s largest gold-backed exchange-traded fund, said its holdings rose 1.99% to 716.01 tonnes on Thursday from 702.03 tonnes on Wednesday. That was the biggest daily inflow since December 18.

Total holdings of the top eight gold ETFs have risen by 3.8-million ounces so far this year after three straight years of decline.

Silver was down 0.4% at $15.68 an ounce, slipping from the $15.95 three-month high touched on Thursday.

Platinum dipped by 0.2% at $958 an ounce after reaching its highest since November on Thursday. Palladium was up 0.4% at $523.50.