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Bullion off record highs, trading below $2,500/oz levels

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Fed Powell's Jackson Hole speech due later in the day

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Lofty prices smother purchases in top Asian hubs

(Add comments, details; update prices and graphics)

By Daksh Grover

Aug 23 (Reuters) - Gold prices inched up on Friday but

were set for a weekly decline, as the U.S. dollar and Treasury

yields rebounded ahead of Federal Reserve Chair Jerome Powell's

speech that could offer fresh insights on the central bank's

interest rate cuts plans.

Spot gold rose 0.3% to $2,491.35 per ounce by 0602

GMT and U.S. gold futures gained 0.4% to $2,526.80.

"Gold's stay below $2,500 could be temporary in nature, with

the fundamentals still appearing favourable for the precious

metal," said Tim Waterer, chief market analyst, KCM Trade.

After hitting an all-time high of $2,531.60 on Tuesday,

bullion has fallen nearly 1% this week, hurt by a bounce in

dollar index and benchmark U.S. 10-year yields.

Powell is expected to deliver remarks at the annual central

banking conference in Jackson Hole, Wyoming at 1400 GMT.

Fed policymakers on Thursday supported starting rate cuts

next month as inflation eases and the labor market cools, though

one cautioned against rushing to ease policy.

Traders have fully priced in Fed easing next month, with a

76% chance of a 25-basis-point cut, according to CME FedWatch

tool. A low interest rate environment tends to boost

non-yielding bullion's appeal.

After a strong rally, a pullback to $2,470-$2,475 is

expected, offering a fresh entry point and if geopolitical

tensions rise, gold may break $2,524 resistance level further

pushing gold to $2,580, said Ajay Kedia, director at Kedia

Commodities, Mumbai.

On the physical demand side, a rally in gold prices stifled

the metal's appeal in major Asian hubs this week, with dealers

offering deeper discounts to charm buyers.

Meanwhile, spot silver rose nearly 1% to $29.22 per

ounce and was up 0.8% for the week.

Platinum gained 1.1% to $953.55 and palladium

was flat at $932.48. Both metals were on track for a weekly

decline.