Disappointing U.S. indicators tend to dampen expectations that dollar-weakening monetary stimulus programs such as the Fed's monthly USD85 billion bond-buying program will end soon.
Gold and the dollar tend to trade inversely with one another.
On the Comex division of the New York Mercantile Exchange, gold futures for August traded at USD1,328.35 during U.S. afternoon hours, up 0.67%.
The August contract settled down 1.14% at USD1,319.50 a troy ounce on Wednesday.
Gold futures were likely to find support at USD1,269.45 a troy ounce, the low from July 17, and resistance at USD1,347.85, Tuesday's high.
The Labor Department said earlier that the number of individuals filing for initial jobless benefits last week increased by 7,000 to 343,000 compared with expectations for a gain of 4,000 to 340,000.
The numbers weakened the dollar by keeping expectations alive the Federal Reserve will continue stimulating the economy, which was bullish for the yellow metal.
In a separate report, the Commerce Department said orders for durable goods rose by 4.2% in June, outpacing expectations for an increase of 1.3%.
Durable goods for May were revised to a 5.2% gain from a previously reported 3.7% increase.
Core durable goods orders, which exclude volatile transportation items, were flat in June, missing expectations for a 0.5% increase, which supported gold prices.
Elsewhere on the Comex, silver for September delivery was up 0.76% at USD20.173 a troy ounce, while copper for September delivery was up 0.13% and trading at USD3.183 a pound.
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