Spot gold was little changed at $1,291.61 per ounce as of 11:50 a.m. EDT (1550 GMT).
US gold futures eased 0.2 percent to $1,296.20 per ounce.
"The poor retail sales print definitely did give gold a short-term tailwind, especially at levels where not too many parties are looking to aggressively sell," said Tai Wong, head of base and precious metals derivatives trading at BMO.
"However, gold's tentative probe higher has been blunted by a strong ISM print, which has sent yields retracing higher. Gold appears to need some additional help to retake $1,300."
US retail sales unexpectedly fell in February, reinforcing the view of flagging US economic growth in the first quarter. This pressured the dollar, bolstering gold's appeal among buyers holding other currencies.
However, bullion gave up some its gains after data pointed to a rebound in US manufacturing activity in March.
Monday's data follows weaker-than-expected consumer spending numbers in January and modest income growth in the United States, fanning worries slowing global growth was spreading to the world's largest economy as well.
The euro zone was just as concerned after inflation unexpectedly slowed in March, adding to the European Central Bank's headaches as it battles an economic slump.
"We still think the global economy is slowing in the 12 to 18 month horizon, especially in the US, which should help gold in the longer term," Julius Baer analyst Carsten Menke said.
Supporting bullion was progress in US-China trade negotiations, which concluded last week, with Washington calling the talks "candid and constructive."
"Immediate support (for gold) was around the $1,288-90 lows seen last week, with key support around the $1,277-80 range. On the upside, gold could face resistance between $1,300-$1,310, especially the 50-day moving average just under $1,310," BMO's Wong said.
Expectations the US Federal Reserve will refrain from interest rate hikes and uncertainties surrounding economic growth are likely to help gold have a strong rally, analysts said.
Speculators increased their net long position in COMEX gold for the second straight week in the week to March 26, data showed on Friday.
Among other precious metals, spot palladium rose 2.4 percent to $1,417.30 per ounce, having declined more than 11 percent last week.
Silver was up 0.2 percent at $15.16 per ounce, while platinum was up 1 percent at $853.82.