* Palladium hits record high of $1,785.50/oz
* Silver climbs to a one-month peak of $18.33/oz
* Gold eyes best week in more than a month
* GRAPHIC-2019 asset returns: tmsnrt.rs/2jvdmXl (Recasts with added comments, details, updates prices)
By Brijesh Patel
Oct 25 (Reuters) - Gold steadied on Friday, paring earlier gains as equity markets rose and the dollar strengthened after Washington said it was close to finalizing parts of a trade pact with Beijing, but bullion was still on track for a weekly gain.
Deficit-hit palladium notched an all-time high, meanwhile, driven by short supplies of the auto-catalyst metal.
Spot gold was flat at $1,503.11 per ounce at 1:55 p.m. EDT (1755 GMT), having earlier hit its highest since Oct. 3 at $1,517.70 gaining nearly 1%. The precious metal was up about 1% so far this week.
U.S. gold futures settled mostly unchanged at $1,505.30.
“Positive comments on a Phase 1 trade deal from two of Donald Trump’s hawkish trade triumvirate triggered profit-taking after gold failed to breach $1,520, which has been the top of the recent range,” said Tai Wong, head of base and precious metals derivatives trading at BMO.
“This combination saw earlier momentum based traders who bought above $1,505 per ounce liquidate.”
The U.S. Trade Representative’s office said on Friday deputy-level talks would carry on, but provided no details on the areas of progress. President Donald Trump said the United States was doing “very well” in the negotiations.
CNBC earlier reported that top negotiators from the two countries “made headway on specific issues” related to trade on a phone call.
A sense of positive developments on the trade front lifted U.S. stocks higher, with the S&P 500 rising above its record closing high.
Also weighing on gold, the dollar index gained 0.3% and U.S. Treasury yields edged slightly higher.
However, offering limited support to bullion was the continuing uncertainty surrounding Brexit. The European Union agreed to London’s request for a Brexit deadline extension on Friday but set no new departure date, giving Britain’s divided parliament time to decide on Prime Minister Boris Johnson’s call for a snap election.
Meanwhile, recent weak economic readings out of the United States lifted expectations for another U.S. rate cut next week.
Gold tends to appreciate on expectations of lower interest rates, which reduce the opportunity cost of holding non-yielding bullion.
Elsewhere, palladium eased 0.4% to $1,769.59 an ounce, having earlier hit an all-time high of $1,785.50.
Palladium is in a strong uptrend supported by the fundamental story, Saxo Bank commodity strategist Ole Hansen said. “If we do break $1,785, we could see some additional buyers into that break, taking palladium to the 1,800 level.”
Silver jumped 1% to $17.94 per ounce after hitting its highest since Sept. 25 at $18.33. It was up 2.5% for the week.
Platinum gained 0.6% to $929.42, on track for its best week in eight. (Reporting by Brijesh Patel in Bengaluru; Editing by Richard Chang and Tom Brown)