* Gold down 0.3% this week

* All eyes on U.S. PCE data due at 1330 GMT

* U.S. economy grew faster than expected in Q4

Jan 26 (Reuters) - Gold prices held in a narrow range on Friday as investors stayed on the sidelines awaiting a key U.S. inflation print later in the day that could set the tone for the Federal Reserve policy meeting next week.

Spot gold was little changed at $2,022.29 per ounce by 1020 GMT, down 0.3% so far this week. U.S. gold futures rose 0.2% to $2,022.20.

The crisis in the Red Sea, where attacks on ships by Yemen's Houthi militants have disrupted maritime trade through the Suez canal, is leading to a higher inflation expectations, said Kunal Shah, head of research at Nirmal Bang Commodities in Mumbai.

As a result markets are anticipating that interest rate cuts may be delayed, or may not be as aggressive as earlier, which has meant gold is unable to perform, Shah said.

Oil prices have risen more than 6% so far this year, owing to jitters over the impact to energy supplies from escalating tensions in the Middle East.

Market participants' focus is now shifting to the Fed's preferred inflation indicator, personal consumption expenditure (PCE) data, which is scheduled for 1330 GMT.

"Incoming data from the U.S. remains on the strong side, weighing slightly on prices, but at the same time, the rate cut expectation for the U.S. remains unchanged, keeping gold prices in balance somehow," said UBS analyst Giovanni Staunovo.

"PCE is a key driver of the Fed. Any lower than expected print will be supportive for rate cut expectations and the gold price," he added.

Markets widely expect the Fed to leave interest rates unchanged at its policy meeting on Jan. 30-31, but see a 90% chance of a rate cut by May, according to the CME FedWatch Tool.

Lower interest rates decrease the opportunity cost of holding bullion.

Data on Thursday showed the U.S. economy grew faster than projected in the fourth quarter as inflationary pressures subsided amid solid consumer spending, official data showed.

Spot silver edged up 0.1% to $22.94 per ounce, platinum rose 0.8% to $898.08, and palladium fell 0.7% to $933.27.

(Reporting by Sherin Elizabeth Varghese in Bengaluru; Editing by Jan Harvey)