Besides, profit-booking by speculators also weighed on gold prices.
At Multi Commodity Exchange, gold prices for delivery in February contracts fell Rs 176, or 0.61 per cent, to Rs 28,615 per 10 grams in business turnover of 616 lots.
Also, the metal for delivery in far-month April declined Rs 166, or 0.58 per cent, to Rs 28,622 per 10 grams in 35 lots.
Analysts attributed fall in prices to weak trend overseas as the dollar strengthened, reducing appeal of the precious metal as a safe haven and profit-booking by speculators at prevailing levels.
Meanwhile, gold traded 0.07 per cent down at USD 1,203.10 an ounce in Singapore.