On Thursday, gold prices in India rose, almost erasing losses made on the previous day.
On MCX, gold futures climbed as much as Rs 710 to an intraday high of Rs 51,530 per 10 grams after a correction of Rs 800 seen on Wednesday.
In the international market, prices of the metal remained flat with spot gold little unchanged at $1,904.66 per ounce, even as a possibility of a contested election looms.
Gold could surge in the short term if there is a contested election
The results of the presidential elections remain unclear as Democratic candidate Joe Biden picked up a win in Wisconsin while still fighting President Donald Trump in other battleground states. Neither of the candidates has secured the 270 Electoral College votes needed to determine who wins the White House. Biden is edging closer to winning with 264 votes so far, while Trump has 214 votes.
Meanwhile, Trump's party has filed multiple lawsuits and requested a recount in votes in several battleground states, which will lead to a contested election outcome.
A contested election happens the losing candidate refuses to concede or questions the legitimacy of the results, which could delay the outcome of the election, adding to the uncertainty.
Gold gains in times of uncertainty as the investors seek to park funds in the safe-haven assets rather than risk it in the stock markets.