Spot gold in the international markets was placed at $1,330 an ounce, after rallying as much as $1,391 an ounce towards the early part of the week following tensions in Ukraine and concerns about growth in China.
On the MCX gold dropped marginally by Rs 11 to Rs 29,740. Silver on the other hand shed as much as Rs 132 to Rs 47,860.
Gold and silver are expected to fall even further as equities across the globe continue to strenghthen.
The decision by the US Federal Reserve to continue to taper its QE3 programme is likely to maintain the pressure on gold.