* Dollar index climbs to five-month high

* GRAPHIC-2018 asset returns: http://tmsnrt.rs/2jvdmXl

(Updates prices; adds comment, byline, NEW YORK to dateline)

By Renita D. Young and Jan Harvey

NEW YORK/LONDON, May 21 (Reuters) - Gold on Monday marked anew low for the year to date after U.S. Treasury SecretarySteven Mnuchin's declaration that a trade war between China andthe United States was "on hold" helped boost appetite forhigher-risk assets, such as stocks.

Buoyancy in U.S. Treasury yields also weighed on appetitefor non-interest-bearing assets, like bullion, analysts said. MKTS/GLOB

Spot gold XAU= fell to its lowest since late December at$1,281.76 an ounce, and was down 0.03 percent at $1,291.1 perounce by 1:34 p.m. EDT (1734 GMT). U.S. gold futures GCcv1 forJune delivery settled down 40 cents, or 0.03 percent, at$1,290.90 per ounce.

"The dollar's riding high and the 10-year (Treasury note's)yield has broken above 3.05 percent for the first time since2011," said Mitsubishi analyst Jonathan Butler. FRX/

A stronger dollar makes assets priced in the U.S. greenbackmore expensive for holders of other currencies, while a bouncein yields had added to pressure on gold.

"With the China trade news, international investors sold offgold," said Michael Matousek, head trader at U.S. GlobalInvestors.

The world's two largest economies stepped back from thebrink of a global trade war and agreed to hold further talksaimed at boosting U.S. exports to China. urn:newsml:reuters.com:*:nL3N1SS1VH

Gold prices last week fell below thepsychologically-important level of $1,300 an ounce, and postedthe first weekly close below the 200-day moving average sincelate December.

The yellow metal is also being weighed down by expectationsthat the Federal Reserve will lift U.S. interest rates againnext month. Higher interest rates make non-yielding assets likegold less attractive to investors.

Naeem Aslam, chief market analyst at Think Markets, saidinvestors were now looking ahead to this week's meeting of theFederal Open Market Committee, which sets rates.

"If the Fed doesn't tame its hawkish stance, we would expectmore weakness in the gold price," he said.

Mitsubishi's Butler said gold could benefit from safe-havenbuying in the long run if that exuberance loses steam andinflation pressures mount. But he added: "It's possible that wemight see a further correction in the very short term. That willof course depend on the newsflow, and whether the dollar canhold on to its gains."

Meanwhile, platinum XPT= gained 1.9 percent at $899.50 anounce, after also marking a fresh low for the year in earliertrade at $873.50.

Silver XAG= was up 0.4 percent at $16.49 an ounce, whilepalladium XPD= , the most industrial of the major preciousmetals, jumped 2.9 percent to $990.72.

<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^GRAPHIC-2018 asset returns: http://tmsnrt.rs/2jvdmXl

^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^> (Additional reporting by Apeksha Nair in Bengaluru; editing byAdrian Croft and G Crosse) ((Renita.Young@tr.com; +1-646-223-8699; Twitter @RenitaDYoung http://www.twitter.com/renitadyoung))