Gold drops to month's low on sluggish demand; silver ends flat

Metal rebounds abroad from 5-week low after Greek deal fails, but gains capped on buzz of earlier Fed rate hike

Extending its slide for a third day, gold prices fell to hit a one-month low at the local bullion market here due to reduced demand from stockists and retail investors amid confusing overseas cues.

Elsewhere, silver eased marginally on poor industrial buying support.

Standard gold (99.5 purity) drifted by Rs 175 to end at Rs 27,105 per 10 grams from overnight closing level of Rs 27,280.

Pure gold (99.9 purity) also slumped by a similar margin to conclude at Rs 27,255 per 10 grams against Rs 27,430.

Silver (.999 fineness) softened by Rs 10 to settle at Rs 38,450 per kg as compared to Rs 38,460 yesterday.

On the global front, the precious metal bounced back from five-week low on safe-haven bet after talks between Greece and its European partners failed to reach agreement, but gains were capped amid growing possibility of an earlier Fed rate hike.

Spot gold was substantially higher at $1,222.70 an ounce in early European trade. Silver gained at $16.83 an ounce.