(Adds analyst comments, market details, updates prices, adds NEW

YORK to dateline )

* Rate futures imply no Fed move this month, while a

September hike is priced in

* US crude falls 1.74% to $68.29 a barrel

* Fed's Warsh says inflation expectations and risks have

eased in recent weeks

By Rodrigo Campos and Danilo Masoni

NEW YORK/MILAN, July 1 (Reuters) - A gauge of stock markets

around the world edged up on Wednesday as the U.S. central bank

head said inflation expectations have fallen, while crude oil

prices were down as optimism over U.S.-Iran talks eased supply

concerns.

Traders also watched for possible Japanese intervention in the

currency market after the yen touched fresh 40-year lows against

the dollar.

Speaking on a panel of central bankers in Sintra, Portugal,

Federal Reserve chair Kevin Warsh said inflation expectations

and inflation risks have come down in recent weeks. He said his

fellow U.S. policymakers will decide whether to raise interest

rates when they begin their next meeting, keeping to his word on

not giving forward guidance.

His comments weighed on the dollar, which has been

underpinned by rising expectations of Fed rate hikes this year,

as inflation runs well above the central bank's 2% annual

target. Still, many analysts believe the inflation picture will

improve in the months ahead.

"Nothing that we see suggests that any imbalance either on

the activity side or the inflation side is growing rapidly,"

said Steve Englander, head of global G10 FX research and North

America macro strategy at Standard Chartered Bank's New York

branch.

"You can afford to wait and see how these longer-term

technological trends play out," Englander added. "What we do see

is that unit labor costs are very, very soft, and ultimately

that's what the Fed controls."

The dollar index, which measures the greenback

against a basket of currencies including the yen and the euro,

rose 0.13% to 101.36, with the euro down 0.35% at

$1.1381. Against the Japanese yen, the dollar last

weakened 0.07% to 162.43.

Futures imply no move from the Fed in its meeting late this

month, while a hike in September is priced in.

In late morning trading on Wednesday in New York, the Dow

Jones Industrial Average rose 239.04 points, or 0.46%, to

52,558.24, the S&P 500 rose 15.04 points, or 0.20%, to

7,514.40 and the Nasdaq Composite fell 34.22 points, or

0.13%, to 26,179.50.

MSCI's gauge of stocks across the globe rose

0.61 point, or 0.05%, to 1,121.07, and the pan-European STOXX

600 index fell 0.31%, while Europe's broad FTSEurofirst

300 index fell 10.51 points, or 0.41%. Emerging market

stocks rose 0.82 point, or 0.05%, to 1,723.71.

In Asia, Japan's Nikkei gained 0.6% after surging

37% last quarter, with strong tech demand lifting sentiment

among big manufacturers to an eight-year high. South Korea's

main index fell about 2%, following a 68% rally last

quarter driven by AI-fuelled chip demand.

In energy markets, oil prices fell as optimism over

U.S.-Iran talks eased supply concerns.

"The negotiations that are currently taking place in Qatar

are perceived as being positive (and) that has allowed prices to

drift further," Saxo Bank analyst Ole Hansen said. "There is a

chance that we could see even lower prices."

U.S. crude fell 1.74% to $68.29 a barrel and Brent

fell to $71.35 per barrel, down 2.19% on the day.

Despite sharp price declines last quarter, both are up nearly

20% year-to-date.

Spot gold jumped nearly 2% after posting on Tuesday

its largest quarterly drop since 2013.