Continuing its loss for the third day, gold prices plunged by Rs 155 to close at over one-week low of Rs 28,020 per ten gram in the national capital on Tuesday.
This was largely in tune with a weakening trend overseas amidst low demand from jewellers and retailers.
Silver also declined by Rs 100 to Rs 42,700 per kg on reduced offtake by industrial units and coin makers.
Bullion merchants said apart from subdued demand from jewellers and retailers despite ongoing festive season, a weakening global trend where gold eased to over one-week low as investors weighed the health of the global economy against tension between Ukraine and Russia, mainly weighed on precious metal prices.
Gold in Singapore, which normally set price trend on the domestic front, fell 0.80 per cent to $1,275.28 an ounce, the lowest since August 26 and silver by 0.40 per cent to $19.39
Besides, shifting of funds towards the record-breaking equity markets from bullion too dampened the sentiment, they said.
In Delhi, gold of 99.9 and 99.5 per cent purity plunged by Rs 155 each to Rs 28,020 and Rs 27,820 per ten gram, respectively, a level last seen on August 25.
It had lost Rs 125 in the previous two sessions.
Sovereign, however, traded in a tight range in limited deals and settled at last level of Rs 24,600 per piece of eight gram.
Tracking gold, silver ready also declined by Rs 100 to Rs 42,700 per kg while weekly-based delivery gained Rs 50 at Rs 42,190 per kg.
On the other hand, silver coins remained unaltered at Rs 74,000 for buying and Rs 75,000 for selling of 100 pieces.