PRECIOUS-Gold hits two-week high on weak U.S. data; palladium scales new peak

* Gold eyes best week in five
* Deficit-hit palladium up 41% so far this year
* Dismal U.S. data boosts rate-cut hopes
* GRAPHIC-Platinum/palladium ratio: http://tmsnrt.rs/1QjSZAC

(Adds comments, updates prices)
By Diptendu Lahiri
Oct 25 (Reuters) - Gold rose to a two-week high on Friday,
holding above the $1,500 an ounce psychological level, as weak
U.S. economic data spurred expectations for another interest
rate cut by the Federal Reserve, while palladium scaled a fresh
peak.
Spot gold XAU= hit its highest since Oct. 10 at $1,506.76
earlier in the session, and was up 0.1% to $1,505.40 per ounce
at 0805 GMT. The metal has gained 1.1% this week, heading for
its best week in five.
U.S. gold futures GCv1 were up 0.2% at $1,508.20 per
ounce.
The metal breached the $1,500 per ounce ceiling for the
first time in more than six years on Aug. 7.
New orders for key U.S.-made capital goods fell more than
expected in September and shipments also declined, a sign that
business investment remains soft amid the fallout from the
U.S.-China trade war, data showed on Thursday. The Fed has cut interest rates twice this year and investors
see another cut on the cards as the economy struggles with the
headwinds from the trade war and slowing global growth.
"Gold still has a number of geopolitical uncertainties and a
high chance of a Fed rate cut at the end of this month to get
support from, but considering the Sino-U.S. trade tensions are
easing, any fresh positive development will weigh on prices,"
said Argonaut Securities analyst Helen Lau.
Gold is considered a safer investment during times of
political and financial uncertainty.
In Europe, Prime Minister Boris Johnson called for a general
election on Dec. 12 to break Britain's Brexit impasse, conceding
he will not meet his "do or die" deadline to leave the European
Union next week.
Asian shares inched higher, tracking small gains in global
markets, as positive earnings helped offset economic growth
concerns, while sterling weakened as the prospect of a British
election added fresh uncertainty to Brexit. MKTS/GLOB
"In the near term, we see three triggers for gold, the trade
spat, Brexit and the Fed's interest rate cut," said Jigar
Trivedi, a commodities analyst at Mumbai-based Anand Rathi
Shares & Stock Brokers.
"Any news on these triggers will lead to the breach of the
$1,485-$1,510 technical level."
Elsewhere, palladium XPD= was flat at $1,778.39 an ounce,
having earlier hit an all-time high of $1,785.50.
Concerns over a supply crunch for the autocatalyst metal
have helped lift prices by more than 41% this year, despite a
weakening auto sector.
Silver XAG= rose 1.5% to $18.04 per ounce, on track for
biggest weekly gain since Sept. 20. Platinum XPT= was up about
0.8% at $931.32, keeping it on course for its best week in
eight.