Gold prices fell Rs 125 at Rs 16,700 per ten gram in the bullion today on sustained selling by stockists after the metal hit a seven-week low in overseas markets amid a firming dollar.
The precious metal dropped in the international market on speculation that an improving US economy will help extend this month's rally in the dollar and reduce demand for gold as an alternative investment.
Gold in New York fell below $1,100 levels to trade at 1,075 dollar an ounce.
Traders said shifting of funds from bullion to rising equity markets for quick gains and retail customers deferring purchases on expectations of further fall in prices, further added to the metal's distress, traders said.
Standard gold and ornaments remained under selling pressure and lost another Rs 125 each at Rs 16,700 and Rs 16,550 per ten gram respectively while sovereign shed Rs 50 at Rs 13,900 per piece of eight gram.
In line with a general weakening trend, silver ready declined by Rs 100 to Rs 27,300 per kg while weekly-based delivery gained Rs 40 to Rs 26,930 per kg.
However, silver coins continued to be asked around the previous level of Rs 33,300 for buying and Rs 33,400 for selling of 100 pieces.
