European shares gained on Friday, snapping a three-week losing streak as earnings updates continued to impress and volatility and jitters over rising inflation eased. Solid reports from large-cap companies including Renault and EDF lifted the STOXX 600 index 1.1 percent, Reuters reported. This week’s recovery follows a turbulent start to February, when worries that rising US inflation would trigger faster increases in interest rates caused equities to sell off around the world. The US currency has been weighed down by several factors this year, including the perceived erosion of its yield advantage as other countries start to scale back easy monetary policy. As 10-year Treasury yields edged back below the 2.9 percent mark on Friday, the dollar strengthened, with its index gaining 0.3 percent and the euro falling back below $1.25 from a three-year high. US President Donald Trumps tax reform will help boost US growth in the short term but may have negative consequences such as on the deficit and debt in the medium term, International Monetary Fund chief Christine Lagarde said, Reuters reported. "The tax reform announced by President Trump will have a stimulus effect on the US economy. It will be in a way positive, especially in the short term," Lagarde told France 2 television on Thursday. "It will also probably have a negative aspect, especially in the medium term, because it will contribute to two things," she said. "On one side it will revive the deficit and therefore increase the debt. And on the other side, since it will boost an economy already at full capacity, we will probably get wage rises, we will probably get inflation increases and as a consequence a rise in interest rates decided by the Fed... If that is the case, that would mean the end of easy money is probably in sight in the United States." Gold prices rose on Friday, heading for the biggest weekly gain in percentage in nearly two years, supported by a weaker dollar as investors look to hedge inflation. Spot gold rose 0.4 percent to $ 1358.40 an ounce by 0801 GMT after touching a three-week high of $ 1360 an ounce. Yellow metal is up more than 3 percent this week and is heading for the best weekly performance since the week ending April 29, 2016. Gold futures in US futures jumped 0.4 percent to $ 1360.90 an ounce on Friday. Among other precious metals, silver rose 0.3 percent in spot trade to $ 16.92 an ounce, platinum rose 0.8 percent to $ 1008.90 an ounce, while palladium gained 0.7 percent to $ 1,025 an ounce.