Gold futures extended losses on Tuesday to hit their lowest level in more than two weeks on a strong rupee and a drop in overseas prices, though demand was moderate in local spot markets as traders sought some price stability.
At 0930 GMT, the actively traded gold for October delivery on the Multi Commodity Exchange (MCX) was 1.11 percent lower at 31,189 rupees per 10 grams, after hitting a low of 31,150 rupees, a level last seen on August 23.
The rupee plays an important role in determining the landed cost of the dollar-quoted yellow metal. It rose on Tuesday.
In the overseas market, gold tracked oil lower on Tuesday after Russia offered to work with Damascus to put Syria's hemical weapons under international control, while firmer equities also dented the precious metal's appeal.
"Some traders are putting orders as the government has clarified import rules and prices are also falling. But some jewellers are waiting for more correction in prices," said a Mumbai-based dealer with a private bank.
India's customs department clarified new gold import rules last week.
Silver for September delivery on the MCX was 2.01 percent lower at 53,030 rupees per kg.
The following were the prices of gold and silver in rupees as of 1315 local time in the spot market,
Gold .999/10 grams 31,770 32,000
Silver .999/kg 54,290 54,713