By Rajendra Jadhav and Anushree Mukherjee

May 16 (Reuters) - Physical gold demand improved across most key Asian hubs this week as a pullback in global prices sparked buying interest among consumers.

This week, Indian dealers were offering a discount XAU-IN-PREM of up to $34 an ounce over official domestic prices – inclusive of 6% import and 3% sales levies - compared to last week's discount of up to $16.

"Demand was better this week compared to last, thanks to the price drop. But a lot of buyers are still waiting it out, hoping prices dip even more," said a Kolkata-based bullion dealer.

Domestic gold prices MAUc1 were trading around 92,900 rupees per 10 grams on Friday after hitting a record high of 99,358 rupees last month.

"Prices need to settle down a bit. If gold drops another 2,000 rupees and hovers around 90,000 rupees, we could see demand really take off," said a Mumbai-based bullion dealer with a private bank.

Spot gold XAU= trading around $3,216.17 as of 0434 GMT on Friday. It hit an over one-month low of $3,120.14 on Thursday and is set for its biggest weekly decline since November. GOL/

Dealers in top gold consumer China charged premiums of $9-$50 an ounce over the global benchmark spot price, compared with premiums of $42-$49 last week. XAU-CN-PREM

"The correction in gold prices has for sure encouraged some bargain hunting and a good entry point for those who may have missed the move higher," said Ross Norman, an independent analyst.

"We expect jewellery demand to stabilise over the coming quarters, retail investment demand will likely be strong given the compelling investment case for gold," ANZ said in a note.

In Hong Kong, gold XAU-HK-PREM was sold at par to a $2 premium, while in Singapore XAU-SG-PREM gold traded at par with the global benchmark to a premium of up to $2.50 per ounce.

In Japan, bullion XAU-TK-PREM was sold at a premium of $0.25 to $0.50.

"Purchases from the general public have been strong as prices dropped," said a Tokyo-based trader.

(Reporting by Anushree Mukherjee in Bengaluru and Rajendra Jadhav in Mumbai; Editing by Eileen Soreng)

((anushree.ashishMukherjee@thomsonreuters.com;))