Where is the price of gold going? Why?

Answer 1

Like other precious metals, gold is measured by troy weight and by grams. When it is alloyed with other metals the term carat or karat is used to indicate the amount of gold present, with 24 karats being pure gold and lower ratings proportionally less. The purity of a gold bar can also be expressed as a decimal figure ranging from 0 to 1, known as the millesimal fineness, such as 0.995.

The price of gold is determined on the open market, but a procedure known as the Gold Fixing in London, originating in september 1919, provides a daily benchmark figure to the industry. The afternoon fixing appeared in 1968 to fix a price when US markets are open.

The high price of gold is due to its rare amount. Only three parts out of every million in the Earth's crust is gold. (0.000003)
Historically gold was used to back currency; in an economic system known as the gold standard, a certain weight of gold was given the name of a unit of currency. For a long period, the United States government set the value of the US dollar so that one troy ounce was equal to $20.67 ($664.56/kg), but in 1934 the dollar was revalued to $35.00 per troy ounce ($1125.27/kg). By 1961 it was becoming hard to maintain this price, and a pool of US and European banks agreed to manipulate the market to prevent further currency devaluation against increased gold demand.

On 17 March 1968, economic circumstances caused the collapse of the gold pool, and a two-tiered pricing scheme was established whereby gold was still used to settle international accounts at the old $35.00 per troy ounce ($1.13/g) but the price of gold on the private market was allowed to fluctuate; this two-tiered pricing system was abandoned in 1975 when the price of gold was left to find its free-market level. Central banks still hold historical gold reserves as a store of value although the level has generally been declining. The largest gold depository in the world is that of the U.S. Federal Reserve Bank in New York, which holds about 3% of the gold ever mined, as does the similarly-laden U.S. Bullion Depository at Fort Knox.

Since 1968 the price of gold on the open market has ranged widely, with a record high of $850/oz ($27,300/kg) on 21 January 1980, to a low of $252.90/oz ($8,131/kg) on 21 June 1999 (London Fixing).[9] On 11 May 2006 the London gold fixing was $715.50/oz ($23,006/kg).[10]

In 2005 the World Gold Council estimated total global gold supply to be 3,859 tonnes and demand to be 3,754 tonnes, giving a surplus of 105 tonnes.[11]

Answer 2

The price of gold will stay high, not because there is less gold in the world but because of the weak dollar. Since gold is priced in dollars, the price of gold will remain high until the dollar regains it strength.

Answer 3

in the previous the excellent melancholy of the 30's a US eco-friendly-again grow to be redeemable in gold, which meant that is cost grow to be locked into the cost of gold. Now it is in trouble-free terms "legal comfortable", which means that is properly worth has alot to do with how a lot of it is in circulation and is being produced. in the course of the Bush II era, the U. S. mint has been generating alot of money to fund the wars in the middle-East. This has made the U. S. dollar bypass right into a free-fall that has made all the different currencies look as if they are going solid, considering each and everything is compared to the fairway-again. Commodities are also priced in US forex and so the upward push in issues inclusive of oil, gold and silver are a effect of a falling US dollar. because the U. S. loan disaster unfolds and international locations inclusive of Saudi Arabia and China commerce of their devalued US money for different currencies, the problem in the U. S. will in trouble-free terms worsen, and the problem will be felt international-huge. So earnings from the holiday and carry on tight. in case you evaluate the cost of gold between 1900 and 2007 utilising diverse currencies, you'll see a diverse style. the cost of gold has more often than not lengthy gone up throughout the time of the last hundred years because of inflation. Medals are an effective, solid aspect to make investments in. bill Gates has a million/3 of his fortune invested in silver. in case you bypass again to about 1993, the Canadian dollar grow to be about sixty 3 cents US. in case you knew the cost of gold in ninety 3, then take the cost of gold now and multiply that through 0.sixty 3 and evaluate that decision to the cost in ninety 3. i'd guess it is alot in route of being equivalent, compared to the fairly large difference in the cost of gold in US money.

Answer 4

The price of Gold these days, is highly influenced by the US dollar and crude oil movements.As gold is considered as a hedging asset,any political or geological turmoil makes people sell their other assets like equities,bonds,currency and invest in gold physically or gold exchange traded funds.Hedge funds have become very large in assets, and they are playing a very crucial role in commodities like crude oil,bullion,non-ferrous metals like zinc,copper and aluminium.Their activities in additon to the demand in India for gold which is the largest consumer of gold for non-productive purposes, is influencing the gold market.

Answer 5

up. Chinese & indian demand + dollar worries IAU - buy