MUMBAI: Gold importers in India, the world's biggest buyer, booked the yellow metal in small quantities as traders took advantage of the lowest price levels since late August.
At 0812 GMT, the most-active gold for October delivery on the Multi Commodity Exchange (MCX) was 0.33 per cent lower at 31,097 rupees per 10 grams, after hitting a low of 31,062 rupees, a level last seen in late August, weighed by a stronger rupee and weak overseas markets.
"Demand is there in gold as it is the season, while it is zero for silver," said Haresh Acharya, head of bullion desk at Parker Bullion, in Ahmedabad.
The festival season is underway in India and will continue till early December.
In overseas markets, gold drifted lower on Monday after posting its biggest quarterly rise in more than two years, tracking a weaker euro as Spain's struggle to control its finances worried investors.
The rupee, which traded firm on Monday, plays an important role in determining the landed cost of the dollar-quoted yellow metal.
Silver also edged lower, falling for the third straight day.
Silver for December delivery on the MCX was 0.47 per cent lower at 62,485 rupees per kg.
