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(Adds comments, updates prices)

* Asian shares rise after China GDP data

* Palladium set for best weekly gain in nearly 4 years

* Platinum eases off near 3-year high

By Asha Sistla

Jan 17 (Reuters) - Gold prices edged higher on Friday but was on track to post its biggest weekly drop in two months as a long awaited U.S.-China Phase 1 trade deal fuelled risk appetite.

Spot gold rose 0.2% to $1,555.24 per ounce by 0823 GMT, heading for a weekly drop of 0.4% - its biggest since the week ended Nov. 8.

U.S. gold futures rose 0.3% to $1,555.40.

Data showed China's economic growth slowed to its weakest in nearly 30 years in 2019 amid the trade war with the United States and sputtering investment, although positive industrial production and retail sales data supported risk sentiment.

Although the Chinese GDP data met expectations, it "did not indicate any significant recovery, and there still are concerns about the impact of the trade war," in turn buoying gold, said Hareesh V, head of commodity research at Geojit Financial Services.

However, "gold traders are waiting for more clear economic indicators or news."

Limiting gold's upside, Asian shares rose as investors latched on to the positive readings from the Chinese data, and following through from the record run in global stock indexes after the phase 1 trade deal was signed.

Gold is considered a safe asset in times of political and economic uncertainty.

Financial markets received a slight reprieve after announcement of the trade pact, although concerns about tariffs and unresolved core issues remained.

In other metals, palladium soared 2.2% to $2,362.71 an ounce, after hitting a record high of $2,395.13 on Thursday, and was set for its biggest weekly gain since March 2016 having risen nearly 12% so far.

"Palladium (prices are soaring) like a rocket ship. It doesn't look like there's more of a story here than the auto-catalytic demand," said Ilya Spivak, a senior currency strategist at DailyFx.

However, "it's starting to look like prices are rising because there's an expectation that they would go up. And that's a dangerous place, because this is how bubbles are made."

Platinum jumped 0.9% to $1,012.58, after hitting its highest since February 2017 at $1,041.05 in the previous session.

"Much of it is a catch-up with palladium, it's a spill-over. Platinum is not as efficient (for catalytic converters as palladium), but if palladium is this expensive then that's the option," added DailyFx's Spivak.

Silver advanced 0.5% to $18.03 per ounce.

(Reporting by Asha Sistla in Bengaluru; Editing by Subhranshu Sahu and Alexander Smith)

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