However, silver held steady at Rs 62,400 per kg in restricted buying from industrial units and coin makers.
Traders said subdued demand at prevailing higher levels mainly led to fall in gold prices.
They said on weak global trend gold dropped below USD 1,700 for the first time in a month, as a stalemate in US budget talks weighed on commodities, countering record assets in exchange-traded products.
Gold in global market which normally set price trend on the domestic front, lost 1.1 per cent to USD 1,696.78 an ounce, the least expensive since November 6 in Singapore.
On the domestic front, gold of 99.9 and 99.5 per cent purity declined by Rs 120 each to Rs 31,880 and Rs 31,680 per ten grams, respectively. Sovereign followed suit and shed Rs 50 to Rs 25,550 per piece of eight gram.
On the other hand, silver ready held steady at Rs 62,400 per kg while weekly-based delivery fell by Rs 425 to Rs 63,475 per kg on lack of speculators buying support. Silver coins also dropped by Rs 1,000 to Rs 80,000 for buying and Rs 81,000 for selling of 100 pieces.