One global price, many local prices
Gold trades almost around the clock in London, New York, Shanghai and other centres, and the benchmark price is quoted in US dollars per troy ounce. Every local price — rupees per 10 grams, dirhams per gram, euros per ounce — is that dollar price converted at the current exchange rate. So your local gold price can rise even on a day the dollar price falls, if your currency weakens.
1. Real interest rates
Gold pays no interest. When savers can earn a high return after inflation on government bonds, holding gold has a high opportunity cost and the price tends to soften. When real yields fall or turn negative, gold becomes more attractive. This relationship has been the most consistent driver over the past two decades, which is why gold traders watch US inflation-protected bond yields and every Federal Reserve meeting.
2. The US dollar
Because gold is priced in dollars, a stronger dollar makes it more expensive for buyers paying in other currencies, which tends to reduce demand and push the dollar price down. A weaker dollar usually has the opposite effect. The link is not perfect, but on most days you will see gold and the dollar index moving in opposite directions.
3. Central bank buying
Central banks hold gold as a reserve asset that carries no counterparty risk. Since 2022 they have bought more than 1,000 tonnes a year, led by China, Poland, Turkey and India, as several countries reduce reliance on dollar reserves. This steady buying puts a floor under the price and is a major reason gold reached record highs in 2024 and 2025.
4. Inflation expectations
Over very long periods gold has broadly kept its purchasing power, so investors buy it when they fear currencies will lose value. In the short run the link is weaker than many assume: gold can fall during inflation if central banks respond with sharply higher interest rates, as in 2022. See the inflation-adjusted chart on our history page for the long view.
5. Investment flows
Gold-backed exchange-traded funds hold thousands of tonnes on behalf of investors. When money flows into ETFs, the funds must buy physical metal; when investors sell, metal is released back to the market. Futures traders on COMEX add speculative positioning that can amplify short-term moves in both directions.
6. Crises and uncertainty
Wars, banking failures, pandemics and political shocks often trigger buying of gold as a safe haven. These spikes can be sharp but frequently fade once the immediate fear passes, unless they also change interest-rate or currency expectations.
7. Jewelry and seasonal demand
Jewelry still accounts for roughly 40% of annual gold demand, concentrated in India and China. Buying peaks around Diwali, Akshaya Tritiya and the Indian wedding season, and around Chinese New Year. High prices tend to reduce jewelry volumes, which partly offsets investment demand and is why local premiums in India and China swing between discounts and premiums.
8. Mine supply and recycling
Mines produce about 3,600 tonnes a year and output changes slowly, so supply rarely drives short-term prices. Recycling reacts faster: when prices jump, more people sell old jewelry, adding supply. In practice, demand-side factors explain almost all of the day-to-day movement you see on this site.
What this means if you are buying or selling
Nobody can reliably predict next week's price. If you are selling scrap, the difference between a good and bad day is usually 1–2%, far smaller than the difference between a good and bad buyer. If you are buying for the long term, spreading purchases over time (dollar-cost averaging) reduces the risk of buying at a short-term peak. Use the live chart and the price-by-year pages to put today's price in context.