* Dollar index retreats from 3-month peak
* Palladium resumes slide after Monday's 5 pct drop
* GRAPHIC-2018 asset returns: (Recasts; updates prices, headline; adds comment, byline, NEWYORK to dateline)By Renita D. Young and Jan HarveyNEW YORK/LONDON, April 24 (Reuters) - Gold prices gainedafter three days of losses on Tuesday as the dollar retreatedfrom an earlier three-month peak and U.S. equities weakened,even as benchmark U.S. Treasury yields passed 3 percent for thefirst time in more than four years.The yield on U.S. 10-year Treasury notes roseabove 3 percent as investors reduced their U.S. bond holdings onworries about rising inflation and growing government debtsupply. Rising yields typically make gold less attractive since itdoes not bear interest.But a retreat in world stocks after yields crossed 3 percentand weakness in the U.S. dollar drew investors to gold andlifted its value, since it is priced in the greenback, saidDavid Meger, director of metals trading at High Ridge Futures inChicago. "The dollar has been a driving force as of late. We've beenseeing a little weakness in equities today, too," Meger said.Spot gold gained 0.5 percent to $1,330.84 per ounceby 1:34 p.m. EDT (1734 GMT), while U.S. gold futures forJune delivery settled up $9, or 0.7 percent, at $1,333.Gold is often seen as a safe store of value in times ofelevated geopolitical or financial risk.
It has benefited in recent weeks from concerns over theU.S.-China trade dispute, sanctions on Russia and unrest in theMiddle East, but has been kept in check by the prospect offurther interest rate hikes from the Federal Reserve.
"Based on interest rates, prices should be lower," saidCapital Economics analyst Simona Gambarini. "But there are a lotof other factors, and a lot of tensions that have been boostingprices... we think gold will continue to trade in this rangebetween $1,300-1,350 depending on what happens with those risks,and the Fed hiking rates."Autocatalyst metal palladium lost 0.5 percent to
$973.65 an ounce, earlier hitting near a two-week low of$960.47. It plunged 5 percent Monday after the United Statesgave American customers of Russia's biggest aluminum producerRusal more time to comply with sanctions. Rusal owns a 28 percent stake in Norilsk Nickel ,the world's biggest palladium producer.
"(Palladium) has followed base metals prices on theirdownward trajectory now that the United States is consideringlifting the sanctions against Rusal and probably will not imposefurther sanctions against Russia," Commerzbank said in a note.Platinum increased 1.6 percent to $932.10 an ounce,earlier dropping to $910.50, a 2-1/2-week low. Silver gained 1.2 percent to $16.72 an ounce after falling more than 3percent in the previous session.
<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^2018 asset returns: ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^> (Reporting by Jan Harvey and Renita D. Young; Additionalreporting by Swati Verma in Bengaluru; editing by AlexanderSmith and Andrea Ricci)