June 17 (Reuters) - Gold prices rebounded on Tuesday, as

rising tensions between Israel and Iran buoyed demand for the

safe-haven asset, while investors looked forward to the outcome

of the U.S. Federal Reserve's policy meeting this week.

FUNDAMENTALS

* Spot gold rose 0.5% at $3,399.90 an ounce, as of

0048 GMT, after dropping more than 1% in the previous session.

* U.S. gold futures edged 0.1% higher to $3,419.20.

* Israel and Iran attacked each other for a fifth straight

day on Tuesday, and U.S. President Donald Trump urged Iranians

to evacuate Tehran, citing what he said was the country's

rejection of a deal to curb nuclear weapons development.

* On Monday, an Israeli strike hit Iran's state broadcaster

and the head of the U.N. nuclear watchdog also indicated

extensive damage to Iran's biggest uranium enrichment plant.

* Gold is considered a safe-haven asset during times of

geopolitical and economic uncertainty.

* Investors will look forward to a host of central bank

monetary policy decisions this week, with the spotlight on the

Fed.

* The U.S. central bank is widely expected to keep interest

rates unchanged at the end of its policy meeting on Wednesday.

* Its Chair Jerome Powell's comments following Fed's

interest rate decision will be eagerly watched for more cues on

the rate cut path.

* Stock indexes closed higher after last week's losses and a

barrel of oil got $1 cheaper on Monday as investors took heart

from reports that Iran was seeking to end hostilities with

Israel.

* SPDR Gold Trust, the world's largest gold-backed

exchange-traded fund, said its holdings rose 0.15% to 941.93

tonnes on Monday from 940.49 tonnes on Friday.

* Elsewhere, spot silver was up 0.1% at $36.35 per

ounce, platinum fell 0.3% to $1,242.03, while palladium

eased 0.2% to $1,027.50.