* Trading remains thin amid holiday in China, India

* Iran says it would retaliate with strikes on U.S.

positions

* Annual US inflation posts biggest gain in about 3 years

in March

* Brokerages price out Fed rate cut expectations for the

year

(Updates prices as of 0436 GMT)

By Pablo Sinha

May 1 (Reuters) - Gold prices were largely steady in

thin trading on Friday, but were headed for a weekly decline,

pressured by higher oil prices that have stoked inflation

concerns and reinforced expectations of higher-for-longer

interest rates.

Spot gold eased 0.1% to $4,614.98 per ounce as of

0436 GMT, and was on track for a weekly loss of about 2%, having

dropped to a one-month low on Wednesday. U.S. gold futures

for June delivery fell 0.1% to $4,626.40.

Trading volumes were light as financial markets in top gold

consumers China and India were closed for public holidays.

"In the Asian session, the market is going to be quite thin

because of public holidays, so we're really in a bit of a

crossroads, or at least waiting for the next catalyst to make

more of a directional move," said Kyle Rodda, a senior financial

market analyst at Capital.com.

Geopolitical tensions remained in focus after Iran said on

Thursday it would respond with "long and painful strikes" on

U.S. positions if Washington renewed attacks, reiterating its

claim to the Strait of Hormuz.

Brent crude prices held above $110 a barrel as efforts to

resolve the Iran conflict hit an impasse.

U.S. inflation accelerated in March as the Iran war raised

gasoline prices, reinforcing expectations that the Federal

Reserve could keep interest rates on hold well into next year.

Global brokerages have also gradually pared back earlier

expectations of two U.S. rate cuts in 2026, with forecasts now

split between modest easing and no cuts, amid persistent

inflation risks and cautious policymakers.

The European Central Bank and the Bank of England kept

interest rates unchanged on Thursday, following similar

decisions earlier in the week by the Fed and the Bank of Japan,

though all signalled inflation concerns.

While gold is traditionally seen as a hedge against

inflation, elevated interest rates aimed at curbing price

pressures tend to weigh on demand for the non-yielding metal.

In other metals, spot silver rose 0.4% to $73.99 per

ounce, platinum eased 0.2% to $1,981.25 and palladium

added 0.1% to $1,525.36.