The European Central Bank should spell out its tolerance for overshooting its inflation target, ECB policymaker Francois Villeroy de Galhau said on Tuesday.
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.
Asian stocks traded cautiously, taking a lead from the US markets, as investors waited for cues from the upcoming corporate earnings season and a key inflation report later this week.
Hedge funds and money managers raised their bullish positions in COMEX gold and silver contracts in the week to April 6, the US Commodity Futures Trading Commission (CFTC) said on Friday.
All three major U.S. stock indexes gained some ground and the S&P 500 and the Dow were last in positive territory, with economically-sensitive small caps and transports lagging.
Spot gold was up 0.8pc at $1,742.78 an ounce by 11:03 a.m. EDT (1503 GMT) after hitting its highest level since March 25 at $1,744.30. U.S. gold futures gained 1pc to $1,745.20.
Gold is seen as a hedge against rising inflation, but firmer Treasury yields, which translate into a higher opportunity cost for holding bullion, have challenged that status.