The attack, claimed by an al- Qaida-linked organisation, was the latest assault against Iraq's Christians, whose numbers have plummeted since the 2003 invasion as the community has fled to other countries.
The Pope denounced the assault at Our Lady of Deliverance church as "ferocious" and called for renewed international efforts to broker peace in the region.
The attack began at dusk on Sunday, when militants wearing suicide vests and armed with grenades attacked the Iraqi stock exchange. Only two guards were injured in the assault, which may have been an attempt by the militants to divert attention from their real target – the nearby church in upmarket Baghdad.
Gunmen went inside the Syrian Catholic church and took about 120 Christians hostage. Deputy interior minister Maj Gen Hussein Ali Kamal said 52 people were killed and 67 wounded. The dead included at least 10 policemen, two priests and five to eight attackers.
It was unclear whether most hostages died at the hands of the attackers or during the rescue.
Security officials said most of the deaths were in the basement where a gunman killed about 30 hostages when Iraqi forces stormed the building. A cryptically worded statement posted on a militant website allegedly by the Islamic State of Iraq to claimed responsibility for the attack.