(Updates to U.S. mid-session trade, recasts first paragraph,

adds context)

* Gold set to fall more than 2% on the week

* Iranian Foreign Minister to arrive in Pakistan - source

* Oil, dollar, Treasury yields, all set for weekly gain

By Ishaan Arora

April 24 (Reuters) - Gold rose on Friday, but was on

track for its first weekly loss in the last five weeks, as

lingering inflation concerns and the uncertain state of the

U.S.-Iran war kept markets on edge.

Spot gold was up 0.7% at $4,724.19 per ounce at 11:01

a.m. ET (1501 GMT), having risen more than 1% earlier in the

session, and is down more than 2% so far this week. U.S. gold

futures for June delivery rose 0.4% to $4,741.30.

The precious metal slumped throughout March as the U.S.-Iran

war strengthened the dollar and stoked fears of higher inflation

that weighed on demand for gold.

More recently, the conflict has been at a standstill, with

the crucial Strait of Hormuz still closed even though military

strikes by any of the nations involved have dwindled. That has

left investors to fill in the blanks or react to U.S. President

Donald Trump's statements, which offset expectations for a deal

to end the conflict with threats to resume attacks.

Iran's Foreign Minister Abbas Araqchi was expected in the

Pakistani capital Islamabad on Friday to discuss proposals for

restarting peace talks with the United States, but was not due

to meet U.S. negotiators, Pakistani government sources said.

Separately, Israel and Lebanon extended their ceasefire for

three weeks.

"It's really just a headline-driven market because of all

the uncertainty - the headlines right now seem to favour some

kind of peace agreement with Iran, the market is looking at a

net positive situation currently. Energies are coming off a

little bit too," said Daniel Pavilonis, senior market strategist

at RJO Futures.

Oil prices ebbed on Friday, but those benchmarks have surged

this week after a second round of talks between the U.S. and

Iran failed to materialize, and as Iran flaunted its control

over the Strait of Hormuz.

Higher oil prices can stoke inflation, driving up chances of

higher interest rates.

"Gold saw a fall (this week) because the oil price was going

higher, so were expectations of higher rates, the dollar,

yields, all correlated," said UBS analyst Giovanni Staunovo.

Benchmark 10-year U.S. Treasury yields were up

1.6% this week, raising the opportunity cost of holding gold,

while the dollar was on track for its first weekly gain in

three, making bullion more expensive for holders of other

currencies.

Spot silver rose 0.6% to $75.86 per ounce, platinum

added 0.7% to $2,019.53 and palladium gained 2.1%

to $1,499.41.