Gold prices in India eased on Friday on a drop in overseas markets and a stronger rupee, although the correction wasn't compelling enough to change sentiments of consumers hurt by rising inflation. The most active June delivery on the Multi Commodity Exchange was down 1.1 percent at 28,828 rupees per 10 grams by 1151 GMT. "Festivals are over. Wedding season buying is also done. So there is no major reason for consumers to visit jewellery shops," said a member of Bombay Bullion Association, who declined to be named. "Investment demand is weak. Investors are hesitating to enter in the market at current level. They don't think prices will rally much from the current level," he said. Demand usually drops between June and mid-August when there are no major festivals. The rupee plays an important role in determining the landed cost of the dollar-quoted yellow metal. The partially convertible rupee closed at 55.54/55 per dollar, 1 percent stronger than its Thursday's close of 56.08/09. Global gold slipped on Friday, extending losses after posting the biggest May drop in 30 years last month, as investors sold assets seen as higher risk like stocks and commodities on mounting concerns over the financial health of Greece and Spain. Gold demand in India is likely to moderate in 2012 as higher inflation trims disposable income at a time prices are stubbornly high on a weak rupee, the head of the World Gold Council in the country said earlier this month.

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