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PRECIOUS-Gold edges up from five-week lows as equities fall

BENGALURU, June 21 (Reuters) - Gold inched up on Wednesday after hitting its lowest in five weeks in the previous session, buoyed as equities fell.

FUNDAMENTALS

* Spot gold had risen 0.2 percent to $1,245.30 per ounce by 0038 GMT, after dropping as far as $1,241 in the previous session.

* U.S. gold futures for August delivery climbed 0.2 percent to $1,246.3 an ounce.

* A renewed slump in oil prices to seven-month lows put Asian investors on edge on Wednesday, overshadowing a decision by U.S. index provider MSCI to add mainland Chinese stocks to one of its popular benchmarks.

* However, MSCI shocked many emerging market investors by failing to upgrade Argentina from the frontier market category where it has languished in recent years. Oil fell about 2 percent on Tuesday, with Brent settling at seven-month lows and U.S. crude at its cheapest level since September, after increased supply from several key producers overshadowed high compliance by OPEC and non-OPEC oil producers with a deal to cut global output.

* The outlook for inflation and the future of financial stability are emerging as dueling concerns at the heart of a debate at the U.S. central bank over how fast to proceed on future interest-rate hikes.

* Dallas Federal Reserve Bank President Robert Kaplan on Tuesday expressed doubt that short-term interest rates are very accommodative and said he wants to wait for more data to understand whether recent weak inflation readings are transitory as he suspects.

* Bank of England Governor Mark Carney doused speculation that he might soon back higher interest rates, telling bankers on Tuesday that he first wanted to see how the economy coped with Brexit talks in coming months.

* British finance minister Philip Hammond said on Tuesday the world's fifth-biggest economy faced tough times as it tries to avoid a damaging "cliff-edge" departure from the European Union.

* British Prime Minister Theresa May said on Tuesday that her government was committed to leaving the EU and would listen to others' views while delivering a Brexit that commanded "maximum public support".

* Russia's central bank posted an increase in gold reserves in May, the fifth consecutive month of gains.

DATA AHEAD (GMT)

1400 U.S. Existing home sales May

(Reporting by Nithin Prasad in Bengaluru; Editing by Joseph Radford)