Gold prices rose Wednesday as the Reserve Bank of India banned banks from loans earmarked for gold purchases.
The bank said the ban was meant to discourage speculative gold purchases. Borrowing could continue for gold purchases for jewelers, however, the banks said.
Gold added $4.90 or 0.28 percent to reach $1,728.50 per troy ounce on the Comex division of the New York Mercantile Exchange, rising for the second consecutive day.
Silver nudged higher, closing up 43 cents or 1.3 percent to $33.45 per ounce.
The dollar index was flat. The euro rose to $1.283 from Tuesday's $1.2818. Against the yen, the dollar rose to 82.52 yen from 81.69 yen.