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* Gold down 4 pct from over 1-1/2 year high touched inJanuary
* GRAPHIC-2018 asset returns:
(Updates prices, PGM minor metals)
By Zandi Shabalala
LONDON, March 21 (Reuters) - Gold recovered from athree-week low as the dollar eased on profit-taking ahead of theU.S. Federal Reserve's meeting later on Wednesday, which couldprovide further clues on the pace of expected interest rateincreases.
With a rate rise of 25 basis points seen as a done deal,investors will be on the lookout for whether the Fed forecastsfour increases in 2018, one more than previously forecast.
Spot gold
U.S. gold futures
"A 25 base hike is priced in, so the potential impact couldcome from the statement and what happens to the Fed projectionfor inflation and rate expectations in 2018," said CapitalEconomics commodities economist Simona Gambarini.
The dollar index
A weaker greenback makes dollar-denominated assets such asgold cheaper for holders of other currencies.
"The U.S. dollar has been the primary driver of the goldprice over the last week, and market reaction to tonight's FOMCannouncement is likely to dictate any near-term move," MKS saidin a note.
"Gold should find support at the $1,307-$1,308 level thathas held over the last couple of sessions, and at thepsychological $1,300 level below that."
The Fed will make an announcement on interest rates at 1800GMT on Wednesday and new Fed Chairman Jerome Powell will holdhis first news conference at 1830 GMT.
The expectations for a faster pace of U.S. rate hikes havecaused gold to fall 4 percent from a 1-1/2 year high reached inJanuary.
Higher U.S. interest rates typically reduce demand fornon-yielding bullion, though analysts said that the possibilityof an escalation in geopolitical tensions could cushion gold.
U.S. President Donald Trump is expected to unveil up to $60billion in import duties on Chinese goods by Friday, followingon from tariffs he imposed this month on imported steel andaluminium.
Investors are worried that Trump's actions could escalateinto a trade war if China and other countries retaliate,threatening global growth.
Rhodium prices rallied to a near seven-year peak, rutheniumto its highest since 2010 and iridium to its strongest in fiveyears on Wednesday as rising industrial demand squeezed pricesof the minor precious metals higher.
Among other precious metals, silver
(Additional reporting by Eileen Soreng and Nallur Sethuraman inBengaluruEditing by David Goodman and Mark Potter) ((zandi.shabalala@tr.com; +44 207 542 5937; Reuters Messaging:zandi.shabalala.thomsonreuters.com@reuters.net))