|Chennai||Rs. 27770.00 (-0.14%)|
|Mumbai||Rs. 29200.00 (2.31%)|
|Delhi||Rs. 27900.00 (-0.36%)|
|Kolkata||Rs. 28270.00 (1%)|
|Kerala||Rs. 27050.00 (-0.37%)|
|Bangalore||Rs. 27550.00 (1.66%)|
|Hyderabad||Rs. 27770.00 (-0.14%)|
Gold looked set to snap a five-week rally by the close on Friday, as strong U.S. economic growth and weak Chinese demand defuel a rally that began in late December.
Bullion gained across most of January to this week as weakness in global equities burnished its safe-haven appeal, and on brisk purchases from top buyer China ahead of the Lunar New Year holiday, which begins today.
However, equities have now steadied after strong U.S. data reassured investors worried about capital outflows from emerging markets, and China has gone into a one-week break, leaving gold without a key support during Asian hours.
"Near-term, gold fundamentals look bearish, as Chinese demand is sidelined for the next few weeks with the New Year holiday," ANZ analysts said in a note.
"Absent a further escalation in emerging market jitters, we expect prices to retest recent lows, potentially falling below $1,230 an ounce."
Spot gold eased 0.1 percent to $1,241.59 an ounce by 0315 GMT after a 2-percent overnight drop.
The metal is down 2 percent for the week after five straight weeks of gains. It is up more than 3 percent for the month; January's early gains were enough to push gold to its first monthly increase in five.
A trader in Singapore said gold could test $1,200 over the Lunar New Year holidays due to China's absence.
Chinese premiums had fallen to $4 just before the holiday from over $20 in the beginning of the month.
Gold is bought for good fortune and as gifts for the new year, with demand also boosted by relatively lower prices compared with the same period last year.
Even when China comes back from the holiday, their purchases are not expected to be as strong as last year, when it imported a record 1,158 tonnes of gold.
Among other precious metals, platinum was headed for a second weekly drop despite strikes at South African mines that have hit about 40 percent of global supply.
South Africa's AMCU union rejected a 9 percent wage offer on Thursday from leading platinum producers, prolonging a week of industrial action.
Meanwhile, the metalworkers union in South Africa also said it will put down tools at a smelter of top platinum producer Anglo American Platinum from February 5.
"Platinum was undermined by gold's plunge despite worsening labour conditions in South Africa," according to HSBC analysts.
Silver, also tracking gold, was headed for its worst weekly drop since late November.