March 1 (Reuters) - Gold started March on a positive note, with prices rising to a four-week high on Friday after muted economic data hardened expectations of a U.S. interest rate cut by June.

Spot gold rose 1.1% to $2,064.69 per ounce by 10:41 a.m. EST (1541 GMT), its highest since Feb. 1 and on track for a second straight weekly rise. U.S. gold futures firmed 0.8% to $2,071.40.

Benchmark U.S. 10-year Treasury yields and the dollar index (.DXY), opens new tab retreated after the data, making gold more attractive.

Data showed U.S. manufacturing slumped further in February. Another set of data on Thursday indicated that the annual increase in U.S. inflation in January was the smallest in nearly three years, keeping a June rate cut from the Federal Reserve on the table.

Bart Melek, head of commodity strategies at TD Securities, said gold is seeing some upside as the market is convinced that the Fed will ease its monetary policy by midyear, lowering the opportunity cost of bullion.

"In three-four months, prices will hit a record if we see poor economic data and the market is convinced that (the) Fed is ready to cut," he said, adding that strong central bank buying is also supporting the market currently.

Lower interest rates tend to boost demand for non-yielding gold.

Physical gold demand in India was subdued for the week as an uptick in domestic prices dented sentiment and prompted buyers to delay purchases.

Spot silver rose 1% to $22.90.

UBS analysts in a note wrote, "we believe market participants underestimate the potential for prices to rise amid lower U.S. rates, a weaker dollar, and firm industrial application demand for silver."

Spot platinum rose 0.6% to $880.80 ounce, while palladium was up 1.4% at $955.50. Both eased on a weekly basis.

Northam Platinum's (NPHJ.J), opens new tab CEO said platinum mining companies in South Africa are caught up in the worst crisis in three decades as prices plummet.