* Spot gold briefly broke above $1,400/oz
* Fed Chairman Bernanke calms fears over bond-buying end
* U.S. dollar moves higher vs basket of currencies (Recasts lead, adds comment after Fed Ben Bernanke testimony)
By Clara Denina
LONDON, May 22 (Reuters) - Gold was flat on Wednesday, giving up earlier gains after U.S. Federal Reserve Chairman Ben Bernanke warned of the risks of holding interest rates too low for too long, which boosted the dollar.
Spot gold had briefly broken above $1,400 to a one-week high of $1,414.25 an ounce after Bernanke said the Fed needed to see further signs the economy was gaining traction before removing current measures.
But it failed to hold onto those gains and was little changed on the day at $1,376.71 an ounce at 1507 GMT after he also emphasized that inflation continued to run below the bank’s target.
Gold is usually seen as an hedge against inflationary pressures, which remain low in major markets at the moment, despite accommodative measures.
“The Fed has been buying bonds since the beginning of the year and gold hasn’t done much, and if you look across the world, we are indeed seeing monetary easing, but inflation expectations are dropping,” Credit Suisse commodity analyst Karim Cherif said.
The dollar traded at a fresh 4-1/2-year high against the yen and a new nine-month high against the Swiss franc after Bernanke’s speech. European and U.S. shares retained gains from earlier in the day.
The Federal Open Market Committee is to release the minutes of its April 30-May 1 meeting later in the day.
U.S. gold futures for June delivery were little changed at $1,378.20 an ounce.
Physical demand remained strong in China, but buying in India, the world’s top gold consumer, has been slowing as its central bank tries to rein in a trade deficit by cutting gold and silver imports.
As a gauge of investor interest, holdings of New York’s SPDR Gold Trust, the largest gold-backed exchange-traded-fund, fell 0.8 percent on Tuesday to 1,023.08 tonnes, the lowest in more than four years.
Spot silver gained 0.5 percent to $22.47 an ounce, regaining ground after dropping to 2-1/2-year lows earlier in the week.
Platinum rose 0.5 percent to $1,465.49 an ounce as supply concerns in South Africa continued and palladium rose 0.10 percent to $744.22 an ounce. (Additional reporting by A. Ananthalakshmi in Singapore; editing by Keiron Henderson and Jane Baird)