Dec 31 (Reuters) - Gold was set for its worst performance in six years, though prices inched up in thin trade on Friday as U.S. Treasury yields dipped, increasing the bullion"s appeal by reducing its opportunity cost. FUNDAMENTALS * Spot gold rose 0.2% to $1,818.43 per ounce by 0119 GMT, hovering close to a one-month high hit on Dec. 28. U.S. gold futures were up 0.2% at $1,818.00. * Gold was set for its biggest annual decline since 2015, having fallen 4% so far this year, as economies recovered from the pandemic"s impact, reducing demand for the safe-haven metal. * Benchmark 10-year U.S. Treasury yields dipped from one-month highs on Thursday, with no major catalysts to drive market direction and many traders out before the New Year holiday. * The dollar index (.DXY) moved away from a one-month low as investors looked beyond a surge in Omicron COVID-19 variant cases and favoured riskier currencies. A stronger dollar makes gold more expensive for buyers holding other currencies. * Wall Street closed lower on Thursday, retreating late in thin holiday volume from record highs set early in the session on strong U.S. data including a drop in weekly claims for U.S. unemployment benefits. * The dip in jobless claims came even as COVID-19 infections in the United States hit a record high for the second day running, Reuters data showed. read more * Spot silver rose 0.3% to $23.11 an ounce, platinum gained 0.3% to $963.92, and palladium fell 0.5% to $1,956.42. * Silver was on track for its worst year since 2014 with a drop of about 12%. Platinum was down nearly 10% while palladium was headed for its biggest yearly decline since 2015 with a 20% slump.