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Gold prices slumped by Rs 165 per 10 grams at the bullion market here on Wednesday, tracking a weak trend overseas and falling demand from retailers and jewellers.
Silver also fell Rs 475 per kg due to reduced offtake by industrial units.
Traders said gold prices edged lower on Wednesday, pressured by stronger equities and a firmer dollar amid speculation over the next US Federal Reserve chief.
Standard gold (99.5 per cent purity) declined by Rs 165 to close at Rs 29,310 per 10 grams from Tuesday's closing level of Rs 29,475.
Pure gold (99.9 per cent purity) also went down by the same amount to finish at Rs 29,460 per 10 grams as against Rs 29,625 previously.
Silver (.999 fineness) fell by Rs 475 per kg to end at Rs 39,110 as against yesterday's level of Rs 39,585.
Globally, gold fell to a 2-1/2 week low after reports that Republican senators favoured John Taylor to become the next head of the US Federal Reserve drove the dollar and US bond yields higher.
Spot gold was down 0.3 per cent at $1,272.23 an ounce at early trade after hitting $1,271.45, the lowest since October 6.
In other precious metals, silver was down 0.4 per cent at $16.87 an ounce.
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