Silver also fell by Rs 350 to Rs 42,350 per kg on reduced offtake by coin makers.
Sentiments remained bearish as gold and silver tumbled to the lowest since June in global markets as US manufacturing in August expanded at the fastest pace in three years, bolstering prospects for the economy and dampening demand for the metal, traders said.
Gold in New York, which normally sets price trend on the domestic front, dropped 1.7 per cent to USD 1,263.10, the lowest since June 17. Silver also fell 1.7 per cent to USD 19.11, the lowest since June 10.
Besides, the strengthening rupee against the dollar made import of precious metals cheaper and diversion of funds towards record-breaking equity market dampened the sentiment, they said.
In Delhi, gold of 99.9 and 99.5 per cent purity remained under selling pressure and shed another Rs 70 each to Rs 27,950 and Rs 27,750 per 10 grams, respectively, a level last seen on June 17. The yellow metal had lost Rs 280 in last three days.
Sovereign, however, remained steady at Rs 24,600 per piece of eight grams in restricted buying.
In line with a general weak trend, silver dropped further by Rs 350 to Rs 42,350 per kg and weekly-based delivery by Rs 450 to Rs 41,740 per kg. The white metal had lost Rs 100 yesterday.
Sovereign, however, continued to be traded at last level of Rs 74,000 for buying and Rs 75,000 for selling of 100 pieces.