The price trend of gold in the international market is affected by many factors. The following are some of the main factors.
USD exchange rate
The USD dollar exchange rate is one of the main factors affecting gold prices. When the U.S. dollar falls, gold prices tend to rise as investors look for a relatively safe asset to store their value. Conversely, when the U.S. dollar rises, gold prices may fall.
Inflation and interest rates
Inflation and interest rates also have an impact on gold prices. When inflation rises, investors may move funds to hard assets such as gold to preserve and increase value. In addition, changes in interest rates may also affect gold prices. If interest rates rise, investors may move money into fixed-income assets such as bonds instead of gold.
Global economic conditions
Global economic conditions also have an impact on gold prices. When the global economy is unstable or experiencing a downturn, investors may move funds to safe-haven assets such as gold. Conversely, when the global economy stabilizes or experiences growth, investors may reduce their exposure to gold.
Geopolitical risks are also one of the important factors affecting gold prices. When risk events such as political instability or war occur, investors may move funds to safe-haven assets such as gold.
Supply and demand
The supply and demand for gold also affect gold prices. If supply decreases or demand increases, gold prices may rise. Conversely, if supply increases or demand decreases, gold prices may fall.
It should be noted that the trend of gold prices is complex and uncertain, and is affected by many factors. Therefore, when making investment decisions, investors need to comprehensively consider a variety of factors, including global economic conditions, monetary policy, political stability, supply and demand, etc., as well as personal investment objectives and risk tolerance.