(Recasts for US market open)

* Lebanon ceasefire raises hopes of progress for Iran

deal

* Spot silver up 3%

* US payrolls report due on Friday

By Anjana Anil

June 4 (Reuters) - Gold prices gained more than 1% on

Thursday as oil prices slipped on optimism over a potential end

to the Iran conflict, which pressured the dollar and caused bond

yields to fall.

Spot gold was up 1.7% at $4,505.35 per ounce as of

9:05 a.m. EDT (1305 GMT).

U.S. gold futures for August delivery gained 1.5% to

$4,532.80.

Reports of a ceasefire deal between Israel and Lebanon have

pressured the dollar and bond yields, helping gold hold just

above the important 200-day moving average, independent metals

trader Tai Wong said.

Israel and Lebanon said late on Wednesday they had agreed to

implement a ceasefire, raising hopes for a deal between

Washington and Tehran. Oil prices fell more than 3% on the news,

amid hopes of a reopening of the Strait of Hormuz.

The dollar eased 0.3%, making greenback-priced bullion more

affordable for holders of other currencies, while lower yields

on U.S. Treasuries, including the 10-year note, boosted gold's

attractiveness.

"Record highs for gold this year seem increasingly unlikely

unless we get a clean, lasting ceasefire with Iran that opens

Hormuz, allowing energy prices to drop and markets to stop

worrying about potentially higher rates," Wong said.

Gold, a traditional safe-haven asset, hit a record high of

$5,594.82 per ounce on January 29. It has lost 16% since the

beginning of the Iran conflict in late February. Elevated

interest rates weigh on non-yielding bullion.

Investors are now turning their attention to the release on

Friday of the U.S. employment report for May. The data could

shed some light on the health of the labor market, which could

help guide the Federal Reserve's future monetary policy path.

Spot silver rose 3.1% to $74.96 per ounce, platinum

gained 1.9% to $1,895.29, and palladium added 1.6%

to $1,322.01.