* European shares at two-week high, dollar up * Premiums for gold bars in Asia steady * Coming up: U.S. durable goods orders at 1230 GMT (Updates prices, changes byline) By Clara Denina LONDON, March 26 (Reuters) - Gold steadied above five-week lows on Wednesday but a firmer dollar, stronger equity markets and signs of recovery in the U.S. economy are likely to limit gains, while support from physical buying was also lacking. Spot gold was up 0.3 percent at $1,313.74 an ounce by 1135 GMT, just off $1,305.59, the lowest level since Feb. 14 it hit on Tuesday. U.S. gold futures stood at $1,314.70 an ounce, up $3.30. Prices touched a six-month high of $1,391.76 last week as mounting geopolitical tensions and fears over slowing economic growth spurred demand for the metal as an insurance against risk. But comments from U.S. Federal Reserve Chair Janet Yellen suggesting there may be around six months between the bank ending its bond buying and starting to raise interest rates weighed on prices. European shares rose to two-week highs and the dollar index , which measures the dollar against six major currencies, rose 0.2 percent, supported by data showing on Tuesday that U.S. consumer confidence surged to a six-year high in March. House prices increased solidly in January, positioning the economy for stronger growth after a weather-induced soft spot. Perceptions that tensions in Ukraine were easing after U.S. President Barack Obama and his allies agreed to hold off on more damaging economic sanctions unless Moscow goes beyond the seizure of Crimea, left investors uncertain of their next moves, analysts said. "Improving U.S. data suggests the gold price should continue moving lower, but uncertainty about geopolitical events is tempering bears' conviction," Macquarie analyst Matthew Turner said. The analyst added that the strength of Chinese demand going into what is seasonally a weaker period could help determine the metal's direction in coming weeks. ASIA DEMAND SLOW The drop in gold prices failed to ignite a rush in physical buying, with dealers in Hong Kong complaining about a slowdown in demand from jewellers and retail investors from mainland China. In a sign of tepid physical demand, premiums for gold bars in Asia were little changed at between 25 cents and $1 an ounce to spot London prices this week, partly due to concerns that a weak yuan could hurt demand from main consumer China. "If physical demand isn't coming in below $1,300, then we may try to go lower," said Yuichi Ikemizu, branch manager for Standard Bank in Tokyo. "There's not much incentive to move at the moment. It will be in a range of $1,300 to $1,320." Russia increased its gold holdings by 7.247 tonnes to 1,041.96 tonnes in February and Turkey also raised its bullion reserves after a sharp fall in the previous month, data from the International Monetary Fund showed. Among other precious metals, silver rose 0.7 percent to $20.02 an ounce and palladium was down 0.6 percent at $777.25 an ounce. Platinum gained 0.3 percent to $1,415.99 an ounce. The chief executive of world No. 3 platinum producer Lonmin has told staff to take voluntary leave because a wage strike now entering its 10th week at its South African operations looks set to continue.

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