"At these low (price) levels, the market could now attract some physical buying interest", said Peter Fung, head of dealing at Wing Fung Precious Metals in Hong Kong.
Asian stocks edged up on Thursday as robust corporate earnings helped Wall Street quell concerns over a surge in USA bond yields, while the dollar hovered near three-month highs against a basket of currencies.
THE euro nursed losses at a two-month low on Tuesday on growing concerns that firmer US Treasury yields would reduce incremental demand for the region's bonds and stocks at a time when hedge funds have amassed record long bets in the single currency.
Spot gold was down 0.1 percent at Dollars 1,333.71 per ounce at 0346 GMT, after earlier touching its lowest since April 10 at USD 1,331.70. Higher US bond yields tend to boost the dollar and weigh on greenback-denominated gold.
The Dow .dji rose 0.25 percent overnight, ending a five-day losing streak, and the S&P 500 .spx gained 0.18 percent on optimism over a spate of upbeat earnings that managed to offset jitters over rising USA bond yields. Meanwhile, there was a decline in political risk after the U.S. said it would likely reach a trade agreement with China and that officials from both sides would sit down for negotiations in a few days.
The WSJ Dollar Index, which tracks the currency against a basket of 16 others, rose 0.5% to 85.28, its highest since January 11.
In other geopolitical news, North Korean leader Kim Jong-un is due to hold a summit with South Korean President Moon Jae-in on Friday, and is expected to meet with Trump in late May or early June.
Interest from physical buyers and technical support at gold's 100-day moving average of $1,319.55 helped to prevent further falls.
According to The Street, "Higher borrowing costs also slow corporate investment and personal spending, two key drivers of US economic growth, putting further pressure on future earnings generation and blunting the value of domestic stock markets".
Gold is often seen as an alternative investment during times of political and financial uncertainty.
Applications to refinance a home loan fell 0.3 percent last week and were 16 percent lower than a year ago.
Platinum rose 0.6 percent to $911 and palladium was down 0.5 percent at $972.90.