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China blames US for global panic over rare earths controls

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Gold is up about 8.1% so far this week

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Silver hits record high of $54.47/oz

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SPDR gold trust holdings hit highest level since July 2022

(Rewrites for EMEA morning session)

By Anushree Mukherjee

Oct 17 (Reuters) -

Gold surged past $4,300 an ounce on Friday, headed for its

biggest weekly gain since December 2008, as geopolitical and

economic uncertainty along with growing U.S. rate cut bets drove

investors to the safe-haven metal.

Spot gold rose 0.2% to $4,335.87 per ounce, as of

0929 GMT, after scaling another record high of $4,378.69

earlier. U.S. gold futures for December delivery jumped

1% to $4,348.90.

Gold is set for a gain of about 8.1% so far this week.

Earlier in the session, gold had temporarily been on track for

its biggest gain since September 2008 when the collapse of

Lehman Brothers fuelled the global financial crisis.

"With rate-cut expectations, geopolitical risks, and

lingering banking concerns all in play, the environment remains

highly supportive for gold," said Alexander Zumpfe, a precious

metals trader at Heraeus Metals Germany.

"Short-term consolidation is possible given the overbought

conditions."

On a technical basis, gold's Relative Strength Index (RSI)

stands at 88, indicating the metal is overbought.

Spot silver fell 0.5% to $53.96 per ounce, after

hitting a record high of $54.47, tracking the rally in gold and

a short squeeze in the spot market. The metal is set for a 7.3%

weekly gain.

Tumbling bank shares pulled global stocks lower on Friday,

while gold hit a fresh peak, as signs of credit stress at U.S.

regional lenders unnerved investors and drove them into

safe-haven assets.

U.S. Federal Reserve Governor Christopher Waller voiced

support for another rate cut. Investors are expecting a

25-basis-point reduction at the Fed's October 29-30 meeting and

another reduction in December.

Meanwhile, China levelled fresh accusations against the

U.S. of causing panic over its rare earth controls, while

rejecting calls to reverse export curbs.

Gold, a traditional hedge against uncertainty and inflation

that thrives in low-rate environments, has surged over 66% this

year, driven by geopolitical tensions, rate cut bets, central

bank buying, de-dollarisation and robust exchange-traded-fund

inflows.

"I believe resilient and huge ETF flows are pulling prices

up," said Michael Haigh, global head of commodities research at

Societe Generale.

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

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

on Thursday, its highest level since July 2022.

Platinum fell 3.3% to $1,656.90 and palladium

lost 2.9% to $1,566.30.