I just replaced the left front wheel bearing/hub on my 96 850 GLT with 75,000 miles on it. I first noticed the noise as I was coming to a stop and thought it was the brake at first but when I let off the brakes the sound continued. It was like a squeaking sound. With the car off and out of gear I pushed and pulled the car and could hear it close up. Over not too long of a time it became louder and when driving down the road I could turn the wheel one direction and the noise would go away-I guess I was unloading the bearing. This was at 40 MPH or so and at slow speed turning more sharply I could hear the noise both ways. I jacked the car up and when I rotated the wheel it did not make noise-might be one way of ruling out the caliper. Without the weight on the wheel the bearing did not make noise but it seems a caliper still would.
Anyway if you go to alloemvolvoparts.com they sell the wheel hub assembly kit (bolts and all included) for $138 or so and it is a project you can do yourself. Shoot me a note if you rule out all the other cheaper fixes and I can give you more details on my experience if you plan on doing it yourself.
Hope its something cheaper and sorry for the long response! Good Luck!
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