International gold prices fell by $7 an ounce to $1,326 in early trade. Gold Futures also dropped in trade with Gold for March delivery falling to Rs 29,535 an ounce. Silver on the other hand dropped to Rs 44,325 an ounce.
Gold and silver have been seeing a decline since last week, ever since the US Fed Chair Janet Yellen hinted at an earlier than expected rate hike.
Gold has seen some buying interest this year, after dropping for the first time in 12 years last year in 2013. A preference for equities has pushed gold prices higher.