Gold (GC=F) prices notched a record high on Monday amid heightened geopolitical tensions.
The price of gold was most recently trading up roughly 2% at $4,472.80 per troy ounce.
Futures opened at $4,369.90 per troy ounce, just down from Friday’s closing price of $4,387.30. The closing price on Friday eclipsed the previous high the yellow metal reached back in October.
Economic and geopolitical conditions continue to spur the precious metal into record territory. Analysts are pricing in at least a couple more rate cuts from the Federal Reserve next year, and the U.S.-Venezuelan tensions continue to ratchet higher as the U.S. military continues its oil blockade.
Interest rates affect gold prices by changing the income available from yield-bearing assets like cash. When cash yields are lower, gold looks more attractive by comparison.
The opening price of gold futures on Monday was 0.4% lower than Friday’s close. Here’s a look at how the opening gold price has changed versus last week, month, and year:
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One week ago: +1.4%
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One month ago: +8.4%
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One year ago: +67.7%
On Dec. 19, gold’s one-year gain was 69%.
24/7 gold price tracking: Don’t forget you can monitor the current price of gold on Yahoo Finance 24 hours a day, seven days a week.
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Learn more: Gold vs. crypto: Which should investors own in debasement trade?
The price of gold can be quoted in multiple forms because the precious metal is traded in different ways. The two main gold prices investors should know about are spot prices and gold futures prices.
Learn more: How to invest in gold in 4 steps
The spot price of gold is the current market price per ounce for physical gold as a raw material, sometimes called spot gold. Gold ETFs that are backed by physical gold assets generally track the gold spot price.
The spot price is lower than what you’d pay to buy gold coins, bullion, or jewelry, since your total price will include a markup called the gold premium that covers refining, marketing, dealer overhead, and profits. The spot price is more like a wholesale price, and the spot price plus the gold premium is the retail price.
Learn more: Thinking of buying gold? Here’s what investors should watch for.
Gold futures are contracts that mandate a gold transaction at a specific price on a future date. These contracts are exchange-traded and more liquid than physical gold. They settle on the contract expiration date or earlier, either financially or via delivery. A financial cash settlement involves paying the contract’s profit or loss in cash. Delivery means the seller sends physical gold to the buyer for the contracted price.
Supply and demand determine gold spot prices and gold futures prices. Factors that influence gold supply and demand include:
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Geopolitical events
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Central bank buying trends
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Inflation
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Interest rates
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Mining production
Learn more: Who decides what gold is worth? How prices are determined.
Whether you’re tracking the price of gold since last month or last year, the price-of-gold chart below shows the precious metal’s steady upward climb in value.
