On the global front, the shiny metal retreated from three-month high spooked by a significantly higher-than- anticipated jobs data as well as strong dollar, prompting investors book profits after recent sharp upmove.

However, silver found fresh buying support from industrial units and recovered by Rs 100 to Rs 44,900 per kg.

The uncertainty around interest rates is likely to continue in the foreseeable future. Experts in the industry expect these movements to be governed largely by inflation trends and advice you to plan investements on a medium-term basis.

Traders said fall in demand at prevailing levels and a weak trend overseas kept pressure on gold prices.

In Delhi, gold of 99.9 and 99.5 per cent purity recovered by Rs 85 each to Rs 28,710 and Rs 28,510 per ten grams, respectively, after losing Rs 160 on Tuesday.

At the Multi Commodity Exchange, gold for delivery in August contracts declined by Rs 68, or 0.25 per cent, to Rs 27,610 per 10 gram in business turnover of 370 lots.

Sentiments in gold remained firm on increased buying by jewellers to meet rising demand for the wedding season, traders said.

Gold in global markets, which normally sets price trend on the domestic front, climbed to $1,322.12 an ounce in Singapore, the highest level since April 12.

At the Multi Commodity Exchange, the metal for delivery in August gained Rs 239, or 0.90 per cent, to trade higher at Rs 26,866 per 10 gm in a turnover of 451 lots.

Traders said sentiments remained bullish after gold made further headway in global market as escalating violence in Iraq boosted demand for the precious metal as a safe-haven.

Traders said some buying by jewellers and retailers amid a firming global trend helped prices move further.

Analysts said the rise in the gold prices was at futures trade was mostly in line with a firming trend overseas on speculation that price declines after a rally in equity markets may spur purchases.

Traders said in the absence of buying support from jewellers and retailers on expectations that prices will come down in coming days mainly kept gold prices steady.

Traders said sentiments remain weak on falling demand from jewellers amid a weakening trend overseas, where gold fell after signs of improving US economy drove advances in the dollar and equities, eroding demand for safe haven as an alternative investments.

The currency has of late gained from a host of factors. But will it touch its highs of the two last years? Experts are not too sure but say it may touch 50-55 in the short term. Let us understand factors that are giving direction to the Indian currency.

After the initial run (till 10:15 am), when the Sensex crossed 25,000-mark, the market has seen profit booking and is currently range bound around 24,700.

Traders said stockists selling in line with a weak global trend as stronger dollar reduced appeal for the precious metal, led to decline in gold prices.

Beta shows the relationship between the movement of a stock and the overall market. A beta higher than one means the stock rises more than the market in bullish conditions and slips more when markets are falling.

However, silver shed Rs 30 at Rs 43,600 per kg on lack of buying support from industrial units. Traders said increased buying by stockists and retailers mainly kept gold prices remain higher for the third day.

The government has started to make physical checks of gold stocks held by wholesalers to ensure inventories match the amount imported by banks and state-run traders.