Oct 17 (Reuters) - Gold extended its record-breaking

rally on Friday, climbing above $4,300, poised for their best

weekly performance in 17 years, as escalating U.S.-China trade

tensions fuelled market uncertainty, with U.S. rate cut hopes

adding to the momentum.

FUNDAMENTALS

* Spot gold rose 0.9% to $4,364.79 per ounce, as of

0040 GMT, after reaching a record high of $4,378.69. Bullion was

up 8.7% for the week so far, marking its best weekly performance

since September 2008.

* U.S. gold futures for December delivery gained

1.6% to $4,373.20.

* Spot silver climbed 0.5% to $53.97 per ounce, after

reaching a record high of $54.35 earlier, tracking gold's rally

and a short squeeze in the spot market, and remained on track

for weekly gains.

* The U.S. dollar index fell to over one week low,

making greenback-priced bullion less expensive.

* Non-yielding bullion has gained over 65% year-to-date,

driven by geopolitical tensions, aggressive rate-cut bets,

central bank buying, de-dollarisation and robust ETF inflows.

* Market sentiment was further influenced by U.S.-China

trade tensions as China accused the U.S. of causing panic over

its rare earth controls, while rejecting calls to reverse export

curbs.

* Federal Reserve Governor Christopher Waller on Thursday

voiced support for another rate cut due to labor market

concerns, with investors expecting a 25-basis-point reduction at

the Fed's Oct. 29-30 meeting and another in December.

* SPDR Gold Trust, the world's largest gold-backed

exchange-traded fund, said its holdings rose 1.18% to 1,034.62

tonnes on Thursday from Wednesday, hitting highest level since

June 2022.

* U.S. President Donald Trump and Russian President Vladimir

Putin agreed on Thursday to another summit on the war in

Ukraine.

* Western nations continued to pressure Russia over its oil

sales, with Britain imposing sanctions on major Russian oil

firms.

* * The U.S. budget deficit shrank by $41 billion to $1.775

trillion in the 2025 fiscal year, the Treasury Department said

on Thursday.

* Elsewhere, platinum gained 0.4% to $1,719.55 and

palladium was up 0.6% at $1,622.67. Both these metals

were headed for weekly gain.

DATA/EVENTS (GMT)

0900 EU HICP Final MM, YY Sep

1230 US Housing Starts Number Sep

1230 US Import Prices YY Sep