Usually, gold is considered to be a stable investment product and its price does not rise too much. However, if you are investing in gold, then you still need to know several factors that affect gold's plunge.
Factors such as gold supply and demand, local interest rates, wars, dollar trends, inflation, global economic conditions, financial crisis, and oil prices all affect the rise and fall of gold prices. Local interest rates: Interest rates in different countries and different regions are closely related to gold, if the local interest rates are high, you should consider whether the interest exceeds the gain, if you spend more interest than gain then you will lose money if you buy gold, and vice versa. War: The development of the economy in the area where the war is taking place will be greatly restricted.
Any local currency may be devalued due to inflation. At this time, gold as a global economic currency, with recognized, and it becomes the object of people snapping up, crazy snapping up will also inevitably cause the price of gold to rise, this time the importance of gold will be the best play out. Dollar trend: Although gold itself is not legal tender, it always has its value and will not depreciate into scrap metal. If the dollar is strong, people will naturally chase the dollar if they have a good chance of investing in its appreciation. On the contrary, when the dollar is weaker in the foreign exchange market, the international gold price will be stronger. Interestingly, the inflation rate in the United States is the most susceptible to the movement of gold. Global economic conditions: Economic conditions are also a factor in the volatility of gold prices. A growing economy will enhance people's desire to invest, and the ability of the private sector to buy gold for preservation or decoration will increase greatly, and the gold price will be supported to some extent. Conversely, during the economic downturn, people are also reluctant to buy gold, and then the gold price is bound to fall.
World financial crisis: When the financial system of the western countries led by the United States has problems that lead to financial market instability, the world's money will be invested in gold, gold demand increases, and the gold price will rise. Gold at this time played the function of a financial refuge. However, when the financial system is stable, investors will no longer look towards gold, and the price of gold will fall. The price of oil: Gold itself is a value preserver under inflation and is inseparable from the US inflation.
