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PRECIOUS-Gold hits 1-yr peak as dollar sags, N.Korea concerns support

* Gold prices up 2 percent for week

* May break resistance at $1,350/oz -technicals

* U.S. dollar index hits lowest since January 2015

(Adds comment, updates prices) Sept 8 (Reuters) - Gold hit its highest in a year on Friday as the dollar sagged after weaker-than-expected U.S. jobs data and as festering tensions over North Korea stoked safe-haven demand.

Spot gold was up 0.3 percent at $1,353.12 at 0420

GMT, after earlier marking its strongest level since August last year. It was up 2 percent for the week, on track for a third weekly gain.

U.S. gold futures for December delivery were up 0.6

percent at $1,358. "Lingering North Korean tensions and a general U.S. dollar, sell-off propelled gold to new 2017-highs overnight. Gold continues breathing thin air at these rarified levels with the next technical target at $1,375.00," said Jeffrey Halley, a senior market analyst at OANDA.

The dollar index was down 0.5 percent at 91.204

against a basket of six major currencies on Friday, after earlier touching its lowest since January 2015. The greenback was under pressure as long-dated Treasury yields fell to 10-month lows, with U.S. jobless claims data and worries about the impact of hurricanes Irma and Harvey on the world's largest economy prompting demand for government debt.

"Looking at the hurricanes, the damage is expected to be huge and because of that safe-haven flows into gold, the Japanese yen and Treasuries have been seen of late," said OCBC analyst Barnabas Gan. "The very strong yellow metal price is due to safe-haven flows. Some of the gold-strength is very much due to the ongoing North Korean tensions as well. The risk for intensified conflicts is there," Gan said. U.S. President Donald Trump said on Thursday he would prefer not to use military action against North Korea to counter its nuclear and missile threat but that if he did it would be a "very sad day" for the Pyongyang leadership. "Gold prices rallied as weaker-than-expected economic data provided some doubt as to the next rate hike by the Federal Reserve," ANZ analyst Daniel Hynes wrote in a note. The U.S. Federal Reserve should continue gradually raising U.S. interest rates given low inflation should rebound, New York Fed President William Dudley said. Higher interest rates tend to boost the dollar and push up bond yields, putting pressure on gold by increasing the opportunity cost of holding non-yielding bullion. Spot gold may break resistance at $1,350 per ounce and rise more to the next resistance level at $1,358, said Reuters technical analyst Wang Tao.

Meanwhile, silver climbed 0.5 percent to $18.17 an ounce, while palladium added 0.6 percent to $961.00 an

ounce.

Platinum gained 0.5 percent to $1,020.50 an ounce.

(Reporting by Apeksha Nair in Bengaluru; Editing by Joseph Radford)