The most-active gold for October delivery about the Multi Commodity Exchange (MCX) was 0. 38% higher from Rs 27, 900 per 10 grams, after hitting a higher of Rs 28, 013.
Global gold prices rebounded 1% from a sell-off in the earlier session, as heightened worries about the sovereign debt turmoil in Europe remain supportive of safe-haven demand for bullion.
The rupee plays an essential role in determining the landed cost of the yellow-colored metal, which is quoted in dollars.
Physical trading retreated following a few sessions of moderate pick-up as prices edged upward. Traders awaited declines to stock for the upcoming celebrations and weddings.
"The business is bit bad, " stated Daman Prakash Rathod, director with Chennai-based MNC Bullion.
India may be the biggest consumer of bullion followed by China. Wedding and festival demand is likely to gain pace and peak in October and November prior to tapering off in December.