* Dealers in India offer discounts for eighth straight week
* Chinese premiums little changed at $10-$12/oz
* Some investors buying gold on dips - traders
* Gold sold at $0.25 discount in Japan
* India's gold market: tmsnrt.rs/2b1Tl6J
By Brijesh Patel and Rajendra Jadhav
BENGALURU/MUMBAI July 26 (Reuters) - High prices prompted some Asian consumers to sell back physical gold this week in a hunt for profits, with cheaper silver emerging as a preferred investment.
Gold buying stagnated in India as local rates soared, though some investors used temporary price dips to buy, hoping to cash in on a further leg up.
Global benchmark spot gold held above $1,400 an ounce this week, up more than 10% this year and on course to end July with a third consecutive monthly gain.
“With prices already at high levels, consumers have decided to re-sell,” said Brian Lan, managing director at Singapore dealer GoldSilver Central, though he added: “Every time there is a price correction, we might see some investors and wholesalers buying.”
“We’re seeing more buying in silver rather than gold,” he said. “People are looking for undervalued assets and it seems like they have decided that silver is that asset.”
In top consumer China, gold was sold at a premium of $10-$12 per ounce over the benchmark, little changed from last week’s $10-$11.
In Hong Kong, gold was sold at a premium of $0.50-$1.20 an ounce, unchanged from last week.
Demand for gold is coming mostly from the investment side, said Ronald Leung, chief dealer at Lee Cheong Gold Dealers in Hong Kong.
The rate of sell-back from consumers has slowed since most expect prices to go even higher, he added.
In Singapore, premiums of $0.50 to $0.80 were charged, versus $0.40-$0.60 previously.
There is also limited buying by manufacturers looking to stock up, a Singapore-based dealer said.
In second biggest consumer India, demand remained sluggish as prices held at record highs, prompting dealers to offer discounts for the eighth straight week.
“Jewellers are not making fresh purchases due to higher prices. They are getting scrap supplies at a discount, which they can use for jewellery making,” said Harshad Ajmera, proprietor of JJ Gold House, a wholesaler in the eastern city of Kolkata.
Dealers offered discounts of up to $24 an ounce over official domestic prices, compared with $33 last week, which was the highest since August 2016. The domestic price includes a 12.5% import tax and 3% sales duty.
Gold futures were trading around 34,850 rupees per 10 grams on Friday, not far from last week’s record high of 35,409 rupees.
“Legal imports have plunged due to the duty hike. In July imports would be less than 40 tonnes,” said a Mumbai-based dealer with a private bullion importing bank.
India raised import duties on gold and other precious metals to 12.5% from 10% earlier this month.
In Japan, gold continued to be sold at a $0.25 discount, a Tokyo-based trader said, adding demand was muted.
Reporting by Brijesh Patel in Bengaluru and Rajendra Jadhav in Mumbai; Additional reporting by Nallur Sethuraman; Writing by Arpan Varghese; Editing by Jan Harvey