The dollar was down 0.2pc. U.S Treasury yields fell to the lowest in nearly two weeks, reducing the opportunity cost of holding non-interest paying bullion.
Spot gold was 0.9pc higher at $1,884.46 by 12:17 p.m. EDT (1617 GMT), having earlier hit its highest since Jan. 8 at $1,889.75. U.S. gold futures gained 0.9pc to $1,885.50.
Spot gold rose 0.3pc to $1,784.23 per ounce by 1:50 p.m. EDT (1750 GMT), after falling about 0.8pc on Tuesday. U.S. gold futures settled up 0.5pc at $1,784.30.
The U.S. dollar slipped to three-week lows after the data, making gold more appealing for holders of other currencies, while benchmark 10-year Treasury yields also ticked lower.
U.S. benchmark Treasury yields continued their dip, translating into lower opportunity cost of holding bullion, after scaling one-year highs last week.
Prices slipped as much as 2.5pc after scaling their highest since Nov. 9 on Wednesday, as 10-year U.S. Treasury yields jumped above 1pc for the first time since March.
Bullion had jumped more than 1pc earlier in the session, helped by reports that U.S. congressional leaders reached agreement on a $900 billion package.