John McCain's path to the presidency narrowed further yesterday with reports that he was giving up on Colorado, a day after a campaign blitz in the battleground state by his running mate, Sarah Palin.

The signs of retrenchment for McCain came on a day when Barack Obama was consumed by family concerns. The Democrat is to take a 36-hour break from the campaign tomorrow to visit his seriously ill grandmother in Hawaii.

The first reports that McCain had given up on Colorado were carried by CNN on Monday. "Gone," one adviser said. Other campaign officials, while denying they had given up on the state, told CNN they were lessening their reliance on a win in Colorado to take the White House.

The campaign was also downgrading its chances in Iowa and New Mexico.

The Republicans were hoping to hang on to all three states, which George Bush narrowly won in 2004.

But with McCain's limited resources against the fundraising juggernaut of the Obama campaign, the Republican has had to make tough decisions on which battlefields to defend.

Obama's lead in Colorado is a more modest 5 points, according to the RealClearPolitics poll average. But he has a huge advantage over the Republican in organisation, with 51 field offices in Colorado, compared with a dozen for McCain.

"The McCain campaign, having taken public financing, just can't play everywhere now. They don't have the resources to do that," said Bule Sewell, a former chair of the Colorado Democratic party.

Obama is also outspending McCain by $300,000 (£177,000) a week on advertising.

McCain's hopes of victory rest on holding on to Florida, Virginia, North Carolina, Ohio, Missouri and Nevada - as well as taking Pennsylvania. But Obama is even or ahead of McCain in the first seven states and has a 12-point lead in the last.

Campaign officials yesterday tried to douse speculation McCain was pulling the plug on Colorado, where Democrats believe that the Republican could be swamped at the polls by the enthusiasm among younger voters and Latinos. However, such decisions are usually kept secret. Last month, McCain faced severe criticism for announcing he was pulling out of Michigan, another battleground.

Palin made three campaign stops on Monday in Colorado and McCain is due there on Friday. But the campaign has barely had any advertising presence on radio or television in the state.

"We see the race tightening both internally and in public polling," said Jill Hazelbaker, his national communications director. "We are within striking distance in the key battleground states we need to win."

Michelle Obama will take a turn as the Democratic headliner on Friday, while her husband is in Hawaii. She is to make campaign stops in Akron and Columbus, Ohio. Her husband is cancelling a rally in Iowa and Wisconsin to visit his grandmother.

Obama's absence is unlikely to hurt his campaign. In a campaign of this magnitude and duration, it is not clear how much personal appearances boost a candidate so close to polling day.

Obama could also get a sympathy boost for taking time out to visit his white grandmother, Madleyn Dunham, 85. It allows him to demonstrate a commitment to family. He was largely brought up by her.

His campaign released photographs of a young Obama with Dunham on his graduation from high school.