Get An Overview Of Gold Price Per Ounce
- Author James Miller
- Published December 28, 2011
- Word count 589
Get An Overview Of Gold Price Per Ounce
The use of gold as currency has been there since ancient times. After the barter system, various means of exchange were introduced but none of them survived on the practical grounds. After a long time, gold came out to be the best and most viable option. Rulers of various countries and regions found the metal most suitable for standardization as the best means of exchange.
Talking about the price of this metal as a whole, gold price per ounce
has seen a gradual rise during the last decade. In the year 2000, the gold price per ounce was 273 US dollars. Due to rising demand, the prices varied on a large scale from the year 2001 to 2004 and finally in the year 2005 the price reached 513 dollars. Further in the year 2006, the prices increase by a few dollars and then showed a steady rise till the year 2010. Finally in 2010, the price for one ounce crossed 1400 dollars.
On August 22, 2011 gold price per ounce soared to a new record height of 1908 dollars according to the London Gold Fixing—a bench mark for the fixing of standard gold prices all over the world.
There are certain decisive factors which hold the key to the fluctuations in the gold prices.
Most Suitable Factors Affecting Gold Price Per Ounce
•Central Banks
The banks that issue currency regulate the money supply and exercise control over the interest rates in the country; come under the standard category of Centralized banks. These banks along with the international monetary fund play an important role in deciding the gold prices in the country. The central banks maintain a gold reserve so as to get effective return on the official reserves. Many countries (such as Russia, China and India) have expressed due interest in buying gold for its banking reserves. Therefore, procurement of gold at such a large scale definitely affects global prices of the precious metal in the market.
Besides this factor, the changes in the interest rates by these banks have a direct impact on the gold price per ounce.
. To control inflation the centralized banks increase the interest rates therefore the availability of currency in the market is reduced hence forth the demand for gold also falls. This fall in demand is proportional to the gold prices. Hence forth the prices of gold decrease with increased interest rates. Similarly, the decrease of interest rates leads to increased gold demand and gold price per ounce.
•Artificial Price Suppression
Artificial price suppression commonly known as market manipulation is nothing but an intentional or deliberate attempt to affect the market prices of commodities for selfish gains.
Such an attempt is considered illegal in most of the countries and strict legal measures are in place to punish the defaulters.
Gold is nothing new to this menace. Various gold associations and influential gold sellers do take undue advantage of these black market techniques. Due to such reasons, uneven fluctuations are seen in the gold price.
•War and other issues of uncertainties
During the wars, there are uncertainties about the next government in the region and therefore people fear the immediate fall in value of the national currency. Hence, they hoard gold to find a suitable way out of it. Due to this, availability of gold in the market falls down and steep hike in gold prices is seen.
As a final point, gold price per ounce is affected by many factors but the significance of the metal makes it the most viable choice to invest in all circumstances.
If you want to know gold price per ounce,visite this website.
http://www.goldpricesounce.com/
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