Gold moved lower on Tuesday after a three-day rally that pushed it over $1,332 an ounce, but prices remained within reach of a 3-1/2 month high due to persistent concerns over global economic growth.
Gold gained 2.9 percent in three straight sessions following weak U.S. economic data last week that cast doubts over the pace of the Federal Reserve's monetary tightening.
More clues on the Fed's thinking is due on Wednesday, when it publishes the minutes of its last meeting.
"I suppose the interest around the FOMC minutes would be what they have to say about the slowdown in the U.S. economy, which could be providing some gold direction in the short term," Macquarie analyst Matthew Turner said.
"So far this year, we haven't seen any major attempt to sell into the rallies ... and the main reason for that is the U.S. data weakness and the emerging markets troubles, which led to a satiation of money being moved out of gold."
Spot gold slipped 0.5 percent to $1,322.20 by 1525 GMT, having cut some earlier losses. It touched its highest since Oct. 31 at $1,332.10 in the previous session.
U.S. gold futures rose 0.2 percent to $1,322.00 an ounce.
The dollar fell 0.2 percent against a basket of currencies after data showed factory activity in New York state slowed this month, while global shares mostly rose.
Gold is seen as an alternative to riskier assets such as stocks and is considered a haven during uncertain times. But the traditional inverse relation between the two assets has been broken recently and gold has often traded in tandem.
The metal has risen 10 percent this year after a 28 percent drop in 2013, which snapped a 12-year run of gains.
Investors have been seeking shelter in gold on fears of slowing growth in China and as a string of U.S. data showed the world's largest economy had been hit by cold weather.
Sentiment favouring the metal in the short term seems to have gathered momentum, but analysts remain cautious overall about the longer run, expecting the dollar to strengthen and the U.S. economy to recover.
"We still believe that a potentially stronger dollar and ever-volatile Fed policy expectation will pose a major hurdle to bullion's upside this year," VTB Capital analysts said.
"However, at the moment investors are calling the shots and there is no point resisting the short-term uptrend until the U.S. data flow improves and investor buying stalls," they said.
In the physical markets, premiums of 99.99 percent purity gold on the Shanghai Gold Exchange eased to about $4 an ounce from Monday's $7 after the price rally.
World Gold Council (WGC) data showed that global gold demand fell 15 percent in 2013 as huge outflows from physically backed investment funds outweighed record consumer demand.
Indian gold consumption is expected to be 900-1,000 tonnes in 2014 on strong jewellery and investment purchases, while China's demand should be 1,000-1,100 tonnes, the WGC said.
Silver rose 0.2 percent to $21.41 an ounce, having climbed to its highest since early November at $21.96 in the previous session.
Platinum fell 0.1 percent to $1,423.49 an ounce, while palladium lost 0.4 percent to $734.20 an ounce.