PRECIOUS-Gold swings higher as dollar surrenders gains

    * Gold rangebound, down 1.2 pct week to date
    * Dollar retreats from highest in more than a week
    * GRAPHIC-2018 asset returns:

 (New throughout, updates prices, market activity and comments;
adds second byline and NEW YORK dateline)
    By Renita D. Young, Zandi Shabalala and Jan Harvey
    NEW YORK/LONDON, Feb 22 (Reuters) - Gold rose on Thursday,
snapping four sessions of losses as the U.S. dollar surrendered
early gains, though the metal remained lower for the week to
date and analysts said they expected trading to be rangebound.
    The dollar slipped against a basket of major currencies
      , as its rally from a three-year low last week ran out of
steam. The yen soared as volatility in financial markets led
investors to favor the Japanese currency.
    Spot gold        gained 0.6 percent at $1,331.56 per ounce
by 1:35 p.m. EST (1835 GMT), bouncing off a session low of
$1,320.61 but still down 1.2 percent so far this week. U.S. gold
futures         for April delivery settled up 60 cents, or 0.1
percent, at $1,332.70 per ounce. 
    "We're seeing a little bit of a weaker dollar as the euro is
up a bit. Currencies across the board are higher than the
dollar," said Chris Gaffney, president of world markets at
    Analysts said they expected gold to remain rangebound,
citing Wednesday's release of the latest Federal Reserve minutes
which showed U.S. central bank policy makers remained worried
about inflation and committed to hiking interest rates.
    While inflation worries could spur safe-haven buying of
gold, rising interest rates would pressure the metal because
bullion pays no interest.
    "The general tone of the FOMC minutes was hawkish and
convinced about the strength of the U.S. economy and that the
inflation target will be reached," said Commerzbank analyst
Carsten Fritsch.
    "This was seen as a further sign that Fed is willing to
increase interest rates further and more than expected." 
    However, some analysts said concerns about rising inflation
may be tempered by caution over recent market volatility.
    Since inflation is poised to surpass the U.S. Federal
Reserve's target this year, investors will likely use gold as an
inflation hedge, Gaffney added.
    "That will continue to keep gold in a fairly narrow range;
the push and pull of interest rates and inflation."
    A break of the $1,322-25 area, however, could see gold test
the 50-day moving average of $1,319.25 then the 100-day moving
of $1,298.50 if dollar strength persists, MKS said in a note.   
    Among other precious metals, silver        rose 0.6 percent
at $16.58 an ounce, palladium        was up 1.8 percent at
$1,038.70 and platinum        gained 0.7 percent at $993.50,
rising from a one-week low of $980.

 (Additional reporting by Eileen Soreng in Bengaluru; Editing by
David Gregorio)