How macroeconomic indicators influence gold price management

Abstract

PurposeThis study purposes to measure the influencing relations between macroeconomic indicators and the prices of gold. Further study measures several factors with the gold price in the context of the United States.Design/methodology/approachThe secondary data are collected to measure relationship and fluctuation of gold prices the data collected from the website world development indicators (WDI) for the period of 31 years 1990–2019. This paper uses different econometric analysis such as analytical unit root test for stationary of data, descriptive statistical analysis for description of data, correlation coefficient test for measuring the inter correlation, and ordinary least square regression analysis for determine the impact of dependent and independents variables. In this research paper, gross domestic product (GDP), inflation rate (IR), unemployment rate (UR), real interest rate (RIR), gross national product (GNP), standard trade value (STV) are included in macroeconomic indicators and consider as independent. The gold prices are considered as dependent variable.FindingsThis study s overall results show an important and optimistic association between GDP, IR and STV with the gold price. Moreover, the RIR shows negative and does not show significant relation with the gold prices.Originality/valueSince several economic crises were included during the data selection studied in this research paper, data error may be present, resulting in the instability of the overall data. However, the study still hopes to find the guiding role of these macro gold price factors in the price of gold from the limited data set. The basic scope of research is that research is limited in the United States.