Spot gold rose 0.2% to $1,519.76 per ounce as of 1039 GMT, having touched the highest level since Sept. 25 at $1,525.20 on Tuesday. U.S. gold futures were down 0.1% at $1,522.30.
"We are seeing a bit of a bounce back in the dollar but if you look at the movements that we saw (in the past few days), it is probably supporting gold in the interim," said OANDA analyst Craig Erlam.
"There is a bit of a correlation between the two (dollar and bullion) right now, which is what really propelled gold from $1,480 to $1,520," he said, adding a further upside in dollar could, however, add pressure to gold.
Against key rivals, the dollar inched up about 0.3% this session, but was trading not far from its July-2019 low touched on Tuesday.
Beijing's decision to ease monetary policy further supported bullion, Erlam added.
China's central bank on Wednesday said it was cutting the amount of cash that all banks must hold as reserves, releasing funds to shore up the slowing economy.
Bullion prices posted their biggest annual rise in nearly a decade in 2019, boosted by the drawn-out trade war between the United States and China that dragged on global economic growth.
Many analysts said prices were likely to rise further in 2020, with shaky growth and global stock markets potentially looking unsustainable at record highs.
"A key thing to look out for is stock markets, which have been setting new highs and, in case there is some correction, we can see some capital flows into gold," said Brian Lan, managing director at dealer GoldSilver Central in Singapore.
Brexit, the U.S. presidential election, protests in Hong Kong and tensions with North Korea would be the other key factors for the market this year, he said.
Investor focus has now turned to the minutes of the Federal Reserve's Dec. 10-11 policy meeting, due at 1900 GMT on Friday.
"Friday's U.S. manufacturing ISM and the December Federal Open Market Committee (FOMC) minutes could provide an impulse," Stephen Innes, a market strategist at AxiTrader said in a note.
Lower interest rates encourage the buying of non-interest-paying bullion.
Among other precious metals, silver gained 0.3% to $17.88 per ounce, while platinum rose 1.5% to $977.48 and palladium edged up 0.5% to $1,949.40 per ounce.