The interest rate of the Federal Reserve is in direct proportion to gold. The more interest rate cuts, the better for gold.
The relationship between oil price and gold
When the price of oil rises, inflation will follow. Gold itself is also a refuge of funds under inflation. The higher the oil price, the higher the inflation, and the higher the gold price.
The relationship between the dollar and gold
The US dollar is the foundation of the current international monetary system. The US GDP still accounts for more than 1/4 of the world GDP, and the total foreign trade volume ranks first in the world. The world economy is deeply affected by the US dollar. The strength of the US dollar directly reflects the quality of the world economy; The price of 1684-97-1-53 or experience group 26-1099-019 is obviously inversely proportional to the quality of the world economy. The value preservation function of gold will be quite obvious when the economy is depressed.
Factors affecting gold price
The change of gold price is mostly affected by the supply and demand of gold itself. Any factor that can affect the supply and demand of gold will cause the fluctuation of gold price. As an investor who pays attention to investment principles, he should understand which factors will affect the gold price and the trend of other investors in the market.
1) US dollar trend
The dollar is the currency of the global announcement, followed by gold. When the international situation is tense and the political situation is unclear, the average person will expect the gold price to rise, but it is also possible to keep cash in hand. The currency most people keep is believed to be the US dollar. There are two common tendencies in the world, namely the US dollar and gold. If investors buy US dollars, they may also sell gold for cash. The gold price may not rise when the situation is chaotic, because it depends on the strength of the US dollar.
2) War and Political Turbulence
In times of war and political crisis, wars are in chaos, and even money is useless when people have to go through difficulties, because no one recognizes and accepts the local currency, but only gold, and gold prices rise due to panic buying. Traditionally, since gold is a currency common to the world, once encountering political crisis and regional war, everyone expects gold prices to rise due to stimulus. Of course, investors should not mechanically speculate on the gold price by following the factors of war, but must consider the dollar factor.
3) World financial crisis
If the world-class banks fail, people will lose confidence in the local (country's) currency. Especially when the American banks fail or there is a large squeeze, it will be a big blow to the dollar. When the financial system of major western countries is unstable, the world capital will be invested in gold, and the gold price will rise as the demand for gold increases.
4) Inflation
If inflation is fierce, holding cash will lose its security, and charging interest will not keep up with the soaring prices. Everyone will purchase gold, especially the inflation in the United States and Europe, which will easily affect the rise and fall of world gold prices. In other countries, such as Chile in South America, the annual inflation is 400 times. Because of the small size of the local economy, the demand for gold is low, which may have no impact on gold prices.
5) Oil price
When the price of oil rises, inflation will also follow. Gold is inseparable from inflation in the United States, and gold itself is also a capital refuge under inflation. The higher the oil price, the higher the inflation, and the higher the gold price.
6) Local interest rate
Gold investment itself cannot generate interest, and its acquisition depends on the rise of price. The higher the interest rate, the more interest, and the more the investment value of gold without interest income decreases. Especially when the interest rate in the United States is high, the world will absorb dollars, and the gold price will inevitably suffer.
7) Economic situation
With the prosperity of economy and the desire of private consumption and investment, the gold price will have some support. On the contrary, when the people are living in poverty, people do not eat well, and their interest in gold naturally decreases, causing the gold price to fall.
8) Supply demand relationship
If the output of gold is increasing, the gold price will be affected and fall back. If gold miners strike, production stops increasing, and new gold mining technologies and new mines are discovered, the supply of gold will increase, and the price will naturally fall. If there is a trend of investing in gold in a certain place, there will be a gold investment boom, which will increase the demand, and the price will rise.
