Gold prices dipped near a two-week low Monday as investors expect the Federal Reserve to raise interest rates this week.
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Gold for August delivery fell 0.2% to $1,268.90 a troy ounce on the Comex division of the New York Mercantile Exchange, its fourth consecutive session of losses and the lowest level since May 30.
The majority of trades expect the Fed to raise rates at its two-day policy meeting this week, scheduled to start Tuesday. Higher rates tend to weigh on gold since the metal pays holders nothing and struggles to compete with yield-bearing assets when borrowing costs rise.
According to the CME Group's FedWatch Tool, nearly 100% of traders believe the central bank will announce an increase in interest rates Wednesday.
Gold has also pared recent gains as some of the political uncertainty around the globe has abated, following the testimony of former FBI director James Comey and the U.K. election.
"The success of Macron's party in the first round of parliamentary elections in France appears to be making market participants feel somewhat more relaxed," said analysts at Commerzbank.
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Meanwhile, copper prices slipped Monday, with futures for July delivery closing down 1.3% to $2.6155 a pound in New York. Prices jumped last week on signals of strong demand from China and ongoing concerns about supply disruptions at copper mines.
Chinese import data Thursday reflected an 8.5% month-on-month increase in refined copper imports in May. Ongoing union disagreements between Freeport-McMoRan and unions at Indonesia's Grasberg mine continued to unsettle the market, with Freeport last week firing 3,000 striking workers.
The company expressed confidence at the end of the week that it would reach an agreement with the Indonesian government this year over a new contract to operate the mine.
Copper was also supported last week by the snow and frost which disrupted copper mining operations in Chile through the first part of last week, Saxo Bank's Ole Hansen said.
For now, though, copper was "still struggling to make any gains or break out of this increasingly tight range we've been seeing for quite a while, " he added.
Any surprise language from the Fed meeting or the decision on short-term interest rates could rattle currency markets and have a secondary effect on industrial metals, Mr. Hansen said.
Write to David Hodari at David.Hodari@dowjones.com and Stephanie Yang at email@example.com
(END) Dow Jones Newswires
June 12, 2017 17:55 ET (21:55 GMT)