Gold rose on Wednesday as the dollar eased slightly in the wake of weaker-than-expected US housing data, while investors awaited the release of the Federal Reserve's Beige Book for direction on interest rates.
Spot gold rose 0.6% to $1,413.66 per ounce as of 10:37 a.m. EDT (1437 GMT). US gold futures rose 0.3% to $1,415.20.
The Fed's Beige Book, a summary of economic conditions across the United States, is due at 2 p.m eastern US time (1800 GMT).
"Gold bounced off its lows pretty good, but it's waiting to see how the dollar will trade as well as the Fed's Beige Book," said Bob Haberkorn, senior market strategist at RJO Futures.
The dollar retreated slightly from a one-week high touched in the previous session, after a federal report showed US housing starts fell in June for a second straight month.
Investors are waiting for the July 30-31 FOMC (Federal Open Market Committee) meeting and have "priced in a 25 basis point cut. If the Fed does anything more, gold will trade higher," RJO's Haberkorn said.
Tuesday's stronger-than-expected June US retail sales data dampened expectations the Fed would cut interest rates by 50 basis points (bps) rather than 25 bps at its month-end policy review.
Chicago Fed President Charles Evans said on Tuesday an interest rate cut of a half a percentage point at the Fed's policy meeting could mean the Fed's inflation goal is reached sooner.
Higher rates tend to boost the dollar and increase the opportunity cost of holding non-yielding bullion.
Gold has also been supported by concerns over global growth, exacerbated by data on Monday pointing to a slowdown in the Chinese economy, analysts said.
"Gold remains locked within the $1,400-$1,420 range, while more broadly, we look for a move outside of $1,380-$1,440 for medium-term direction," MKS PAMP said in a note.
Meanwhile, silver rose 1.6% to $15.80 per ounce, extending gains for a fourth straight session. It touched a more than four-month high of $15.86 earlier in the session.
"Silver Exchange Traded Funds have continued to register substantial inflows in recent days - inflows since the start of the month have exceeded 600 tons," Commerzbank wrote in a note.
"It appears that the pronounced ETF inflows are gradually having an impact after all."
Among other precious metals, platinum rose 0.7% to $843.57 per ounce, trading close to a two-month peak scaled on Tuesday, while palladium gained 1% to $1,539.96.