2. Monetary policy will also affect the price of gold. If the country adopts a tight monetary policy, the price of gold will rise;
3. When a country's purchasing power increases, the price of gold will fall accordingly;
The stock market also has an influence on the price of gold. When investors put a lot of money into the stock market, the price of gold will fall;
5. Oil price will affect the price of gold. When oil prices fall, so will gold prices.
These are all possible reasons for the sharp drop in gold prices.
Brief introduction of gold investment
When investors invest in gold, there are many ways, such as investing in gold bars, coins and gold jewelry. Also buy gold certificates, gold futures, gold funds, etc. Participate in gold investment. It's just that when investors invest in gold, they need to know that gold investment is a relatively stable investment, and investors don't have to worry about the sharp drop in gold prices, resulting in a big loss of funds. Because even if the market plummets and the economy is depressed, the price of gold will not fall easily, but it will rise with the downturn of the market.
After the epidemic, the world began a wave of water release, and there was a wave of Big bounce in gold price, but it began to fluctuate and fall in August 2020. This is similar to the wave of water release after the financial crisis. After the financial crisis in 2008, the price of gold rose sharply, but at the end of 20 12, that is, on the eve of the Fed's withdrawal from QE, it suddenly pulled back and began a long-term adjustment.
The situation is similar now. The price of gold will be adjusted in advance before the Federal Reserve officially withdraws from QE, reflecting the global expectation of tightening monetary policy.
To say what factors affect the price of gold, the dollar should be said to be the most important one, because gold is denominated in dollars, and the cheaper the dollar, the more expensive it is, and vice versa.
Recently, the US dollar index rebounded significantly. The yield of 10-year US bonds, known as the global "benchmark interest rate", hit a two-week high, ending a five-week losing streak, which shows that the US dollar is becoming more and more expensive and global funds are becoming more and more expensive. Put obvious pressure on gold.