* SPDR Gold holdings drop 1.1 pct on Tuesday
* Silver off 2-1/2-year low touched in prior session (Recasts, updates prices)
By Sethuraman N R
BENGALURU, Sept 5 (Reuters) - Gold prices edged up on Wednesday, supported by technical buying amid worries over inflation in emerging markets, but gains were curbed as the dollar rose broadly on heightened concerns about international trade conflicts.
Spot gold was up 0.2 percent at $1,193.24, as of 0758 GMT. In the previous session, it hit $1,189.20, its weakest in more than a week.
U.S. gold futures were mostly steady at $1,198.40 an ounce.
“Gold is holding up at these levels well as there are some uncertainties stemming from emerging market currency crisis,” said Hareesh V, head of commodity research, Geojit Financial Services.
“When the currency weakens, inflation shoots up and gold has historically performed well during those times.”
Inflation worries generally boost gold, which is seen as a safe haven against rising prices.
Emerging markets stocks and currencies were under increased pressure on concerns about inflation in Turkey and after data showed South Africa had slumped into recession in the second quarter.
Fresh U.S. tariffs on another $200 billion worth of Chinese goods could take effect after a public comment period ends on Thursday.
The dollar index, which measures the greenback against a basket of currencies, rose 0.2 percent at 95.617.
“The growing frustration towards trade tariffs and what will be the end result of all of this is supporting the gold prices,” said Naeem Aslam, chief market analyst, Think Markets UK Ltd.
“Secondly, there are some serious concerns about recession, given that South Africa has slipped into it. If emerging markets start to perform really bad, every one will catch the cold. This should support the gold price.”
Meanwhile, markets will be closely watching an employment report due on Friday for clues on the pace of U.S. interest rate increases.
The yellow metal has lost about 8.4 percent this year amid rising U.S. interest rates, trade disputes and the Turkish currency crisis, with investors parking their money in the dollar, undermining the metal’s safe-haven status.
The bearish sentiment in gold has reflected in heavy liquidations in SPDR Gold, the world’s largest gold-backed exchange-traded fund. Holdings have fallen 14.2 percent since a peak in late April, and 1.1 percent to 746.92 tonnes on Tuesday.
Spot silver climbed 0.4 percent to $14.13, after falling to its lowest since January 2016 at $13.97 in the previous session.
Platinum dropped 1 percent to $768.50. In the prior session, prices touched $761.80, their lowest since Aug. 16.
Palladium dipped 0.5 percent to $975.30, after touching an 11-week peak at $988.47 on Tuesday. (Reporting by Nallur Sethuraman in Bengaluru; Editing by Richard Pullin and Sherry Jacob-Phillips)