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PRECIOUS-Gold rises as U.S. dollar, Treasury yields retreat

    * Investors await raft of U.S. economic data this week
    * Dollar eases off highest level in nearly two weeks
    * Gold may test a support at $1,752/oz - technicals

 (Recasts, adds quote, updates prices)
    By Sethuraman N R
    May 3 (Reuters) - Gold prices edged higher on Monday, helped
by a pullback in the U.S. dollar and Treasury yields, while
deficit-stricken palladium held firm after surpassing the
$3,000-per-ounce level in the prior session. 
    Spot gold        was up 0.5% at $1,777.01 per ounce by 0916
GMT. Volumes are expected to be low due to public holidays in
China, Japan, and Britain. U.S. gold futures        rose 0.6% to
$1,778 per ounce.
    "We have had a couple of attempts to the downside, which
have been forcefully rejected. For now, there's still potential
for the upside. But the market is completely lacking confidence
and proper input to determine a direction," said Ole Hansen,
head of commodity strategy at Saxo Bank. 
    "(The) Inflation theme is very much relevant, and as long as
we have concerns about inflation picking up faster than
anticipated by central banks, there is an underlying bid in the
gold market." 
    Benchmark U.S. 10-year Treasury yields             retreated
after hitting their highest in nearly two weeks last week, while
the dollar index        slipped 0.2%. 
    Lower bond yields reduce the opportunity cost of holding
non-interest bearing gold and a cheaper dollar raises gold's
appeal for other currency holders.
    Traders will be eyeing U.S. manufacturing surveys due on
Wednesday and April labour market numbers on Friday for further
clues about recovery in the world's largest economy.
    On the technical front, spot gold may test a support at
$1,752 per ounce, a break below which could cause a fall to
$1,738, according to Reuters technical analyst Wang Tao.
            
    Elsewhere, auto-catalyst metal palladium        rose 0.8% to
$2,956 per ounce, after hitting an all-time high of $3,007.73
per ounce on Friday over supply concerns.
    Silver        was up 0.7% at $26.09 per ounce. Platinum
       fell 0.2% to $1,195.63.

 (Reporting by Nallur Sethuraman in Bengaluru; Editing by
Subhranshu Sahu)
  
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