Gold does not move on one factor. Economists study a web of influences: inflation, central-bank policy, interest rates, real yields, the dollar, growth, geopolitics, central-bank buying and physical supply and demand.
These factors interact — inflation may shift rate expectations, which may move yields and the dollar, which may influence gold.
Every link is a relationship to study, not a guaranteed cause and effect.
Key definitions
- Transmission chain
- A sequence of possible effects from one economic change to others.
Key takeaways
- Several forces act at once
- Chains are possibilities, not certainties