* Spot gold posted worst week since 1983 on Friday

* Oil plunges after Trump postpones strikes

* Silver, palladium up over 3%

(Updates prices)

By Ashitha Shivaprasad

March 23 (Reuters) - Gold prices trimmed losses on

Monday, rebounding from a four-month low hit earlier, after U.S.

President Donald Trump's comments postponing planned military

strikes on Iranian energy infrastructure sent oil prices

plunging.

Spot gold fell 0.4% to $4,470.36 per ounce by 10:53

a.m. ET (1453 GMT), after falling over 8% earlier to a session

low of $4,097.99. It posted its worst weekly performance since

1983 on Friday.

U.S. gold futures fell 2.2% to $4,471.60.

"The overnight sell-off was a continuation of the long

liquidation we've seen over the past several sessions, driven

largely by expectations of rising interest rates. The dramatic

reversal came after Trump's post on Truth Social. The headline

triggered broad reversals across markets - metals, energy and

equities alike," said David Meger, director of metals trading at

High Ridge Futures.

"It's fair to assume that we're going to see volatility

continue," he added.

Higher energy prices due to the Iran war have lately

increased bets on rates staying higher for longer. Gold, despite

its reputation as an inflation hedge and safe haven, has

struggled to benefit as elevated rates raise the opportunity

cost of holding the non-yielding metal.

Trump said the U.S. and Iran have held constructive talks

and that he would postpone any strikes on power plants and

energy infrastructure. Conversations with Iran will continue

throughout the week, he said in a social media post. However,

Iran's Fars news agency, citing a source, said there are no

direct or indirect communications with the U.S.

Following Trump's comments, oil prices plunged and the

dollar moved lower. A weaker dollar makes greenback-priced

bullion more affordable to other currency holders.

Spot gold prices have fallen over 15% since the Middle East

conflict began on February 28, and has retreated about 20% from

its record peak of $5,594.82 reached on January 29.

Among other metals, spot silver rose 3.3% to $70.01

per ounce, while platinum slipped 1.1% to $1,901.53.

Palladium added 3.4% to $1,450.79.