Comments by US St. Louis Fed President James Bullard that the Fed could taper in October, saw gold falling sharply in the international market on Friday, pushing Indian gold prices lower on the MCX in early Monday morning trade.
Gold for October delivery was down Rs 224 on the MCX at Rs 29,688, while silver continued its sharp decline to Rs 48,730, a drop of Rs 576 on the MCX.
Dealers say that gold will continue to take cues from global economic data as well as comments from Fed officials, many of whom are likely to speak this week.
Last week gold had rallied substantially as the Fed decided to keep its tapering programme on hold. Markets had expected the Fed would announce a taper of at least $10 billion last week, but the Fed decided to stay pat, which sent gold prices higher.