Gold prices fell on Friday, and were poised for ‌a weekly loss, as tensions in the Middle East dampened hopes for a U.S.-Iran peace ​deal amid rising inflation and interest rate-hike fears.

Spot gold was down 0.5% at $4,452.20 per ounce, as ​of 0225 GMT. ​It has fallen about 1.8% for the week so far.

U.S. gold futures for August delivery fell 0.6% to $4,478.50.

The Iran-backed Hezbollah militia rejected ⁠a new ceasefire in Lebanon and Israel said it would not withdraw troops from the country, undermining U.S. President Donald Trump's efforts to halt fighting there to forge peace with Tehran.

"Some pessimism around the resolution of the Iran conflict has been ​negative for ‌gold," said Nicholas ⁠Frappell, global head of ⁠institutional markets at ABC Refinery. "I think the trend is to expect tighter interest rate markets, ​which is also weighing on gold."

Kansas City Federal Reserve President ‌Jeffrey Schmid said on Thursday that the U.S. ⁠central bank's choice now is between being patient and holding interest rates steady or hiking rates to tamp down inflation that has been above target for years.

Meanwhile, San Francisco Fed President Mary Daly said the U.S. rate path will depend on how the economy evolves, adding that monetary policy is "in a good place" and the Fed is prepared to respond "either way."

While gold is seen as a hedge against inflation, higher interest rates tend to weigh on the non-yielding ‌metal.

Markets are pricing in a Fed rate hike before year-end, ⁠with a 51% chance of a move by December, ​according to CME Group's FedWatch tool.

Investors are now awaiting the May U.S. nonfarm payrolls data, due later in the day, to gauge the Fed's monetary policy path.

Spot silver fell ​1.4% to $72.89 ‌per ounce, platinum dropped 1.1% to $1,878.68, and palladium slid 1.7% to $1,298.45. All ⁠metals were headed for a ​weekly loss.

(Reporting by Pablo Sinha in Bengaluru; Editing by Subhranshu Sahu)