The benchmark April contract was 1.16 per cent lower at 15,246 rupees per 10 grams at 11:33 a.m., after losing 0.8 per cent in the previous two sessions.

The Obama administration on Monday offered a raft of incentives for private investors to help rid banks of up to $1 trillion in toxic assets that plunged the world economy into crisis.

Further, a strong rupee also pressured the yellow metal metal, making it cheaper.

"Gold is still in correction mode on recovering equities," said Debjyoti Chatterjee, an associate vice president with MAPE ADMISI Research in Mumbai, adding the target in gold is 15,000 rupees.

"The asset re-allocation has started from gold to equities."

"There is a bearish bias due to recovering equity markets. Rupee appreciation would also bring it down more,"" said Gnanasekar Thiagarajan, director with Commtrendz Research.

Support is placed at 15,150 for gold, Thiagarajan said.