* Oil prices climb over 5%

* US, Israel trade airstrikes with Iran

* US dollar, 10-year Treasury yields rise

* US Consumer Price Index data due later in the day

(Updates for EMEA session trade)

By Ishaan Arora

March 11 (Reuters) - Gold steadied on Wednesday, as

higher oil prices reignited inflation worries and tempered hopes

of rate cuts, while safe-haven demand amid the ongoing

U.S.-Israeli war on Iran limited losses.

Spot gold was down 0.1% at $5,186.02 per ounce, as of

0902 GMT. U.S. gold futures for April delivery fell 0.9%

to $5,194.10.

"After yesterday's fall, oil is rebounding today, confirming

that tensions are not yet over. In the last few days gold prices

have not moved significantly, holding well above $5,000," said

Swissquote analyst Carlo Alberto De Casa, adding that a rise in

the dollar and benchmark 10-year U.S. Treasury yields was also

pressuring bullion.

A stronger dollar raises the cost of gold for overseas

buyers, while higher Treasury yields reduce the appeal of

non-yielding bullion.

Oil prices rebounded as markets doubted whether the

International Energy Agency's reported plan for a record release

of oil reserves could offset potential supply shocks from the

Middle East conflict.

The U.S. and Israel traded air strikes with Iran as the war

entered its second week, effectively shutting the Strait of

Hormuz, a chokepoint for a fifth of global oil and liquefied

natural gas.

"It seems likely to me that investors are now increasing

their exposure to the precious metal as a safe-haven asset," De

Casa added.

Markets now await the U.S. consumer price index for

February, due later in the day, and the Personal Consumption

Expenditures (PCE) index, the Federal Reserve's preferred

inflation gauge, on Friday.

Consumer prices likely picked up in February as the cost of

gasoline increased, and with the conflict driving up oil prices,

a further rise in inflation is expected in March.

Investors expect the Fed to keep rates steady at the end of

its two-day meeting on March 18. Despite being viewed

as an inflation hedge, gold loses some appeal when interest

rates rise.

Meanwhile, spot silver fell 1.4% to $87.15 per ounce,

spot platinum lost 1.2% to $2,174.05, and palladium

eased 0.9% to $1,640.75.