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Gold's drivers and price performance

 

Gold is used as a safe-haven, as its price often rallies during periods of uncertainty. Gold is both pro-cyclical and counter-cyclical.

Investment drivers tend to influence heavily short- and medium-term price movements. But long-term price dynamics respond to consumer demand, long-term savings, central bank demand, and supply dynamics.

The factors that influence gold can be grouped into four big themes:

Currencies – strength and weakness of the US dollar and various currencies

Economic growth and market uncertainty – inflation, interest rates, income growth, consumer confidence, tail risks

Tactical flows – price momentum, derivatives positioning

Additional demand and supply dynamics – mine production, idiosyncratic demand-side shocks.