Gold ended lower on Wednesday, retreating from earlier four-month highs, as a dollar rally and surging U.S. new home sales dented bullion's safe-haven appeal.
The metal has risen around 11 percent since the beginning of the year as investors have poured back in on worries about economic conditions in the United States and in China.
U.S. gold futures for April delivery settled 1.09 percent lower at $1,328 an ounce after the Commerce Department said home sales increased 9.6 percent in January to a seasonally adjusted annual rate of 468,000. That was the fastest pace since July 2008.
touched $1,345.35, its highest since late October, before profit-taking pulled it to near $1,332, down 0.9 percent on the day. Despite recent gains, bullion remains well below an all-time high around $1,920 struck in 2011.
Chart: Precious Metals
The dollar rose 0.4 percent against a basket of currencies, adding pressure on the gold price.
An increase in holdings of bullion-backed exchange-traded funds (ETFs) highlights renewed investor interest in gold, but physical buyers in key consumers such as India and China could be waiting for a price correction.
SPDR Gold Trust, the world's largest gold-backed ETF, said its holdings rose 0.26 percent to 803.70 tons on Tuesday from 801.61 tons on Monday.
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