Gold was a touch firmer on Wednesday, trading above $US925 as investor demand for a safe-haven asset spurted in the face of a weaker dollar.
Data released on Tuesday showed an unexpected fall in US housing starts to record lows in April, burnishing bullion's appeal as a store of value.
While the overall health of the economy will stay in focus, the dollar's direction is expected to remain the decisive factor as the traditional negative correlation between the US currency and gold comes more sharply into play.
Gold was at $US926.50 an ounce in Asian trade, up 0.2 per cent from its notional settlement of $US924.65 on Tuesday.
"Gold's generally still on a gradual uptrend and if we can retest and move above the previous high of about $US933, then gold should continue to head higher,'' said Adrian Koh, an analyst at Singapore's Phillip Futures.
The precious metal rose to $US933.50 on Monday.
"I'm still negative on the dollar as it should continue to head lower in the longer term ... that in turn should support gold higher,'' Koh said.
The US dollar fell against the yen on Wednesday, although it inched up a touch against the euro after losing ground the previous day.
US gold futures for June delivery were at $US926.60, down 0.01 per cent from Tuesday's settlement on the COMEX division of the New York Mercantile Exchange.
Bullion is currently down about 8 per cent from an 11-month high over $US1000 marked in February, when risk-averse investors flocked to the precious metal.
Since then, tentative signs that the economy may be over its worst have emboldened investors to seek riskier assets.
This is underscored by the flow of funds into gold-backed exchange traded funds (ETFs), which have recently stalled.
The SPDR Gold Trust, the world's largest, said holdings stood at 1105.62 tonnes as of May 19, unchanged since May 13, and down about 2 per cent from a record marked in April 9.
Gold has been divided between the soft dollar and firmer equities in recent weeks.
