Gold importers in India, the world's biggest buyer of the metal, struggled to get supplies on Monday, paying record premiums just ahead of the peak festival season next month.
India celebrates Dhanteras on Nov. 1, the biggest gold buying festival, when consumers buy the yellow metal to invoke prosperity.
"We are processing orders for exports... the 100 percent export orders need to be cleared first, only after that we will get imports under the 80/20 rule," said a dealer with a private bank importing bullion.
Gold imports for domestic consumption are now tied to exports under the new 80/20 rule, as an embattled government tries to curb a record trade deficit.
"Given (sales) performance (from India) over the last several weeks, the outlook for physical gold buying doesn't seem very promising," said UBS in its daily note to clients.
The absence of pent up demand from India is discouraging for gold, diminishing the potential price lift due to seasonal appetite, said the UBS.
The actively traded gold for December delivery on the Multi Commodity Exchange (MCX) was 0.71 percent higher at 29,688 rupees ($480) per 10 grams.
The most-active silver for December delivery was 1.35 percent higher at 48,844 rupees per kg.