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Research on the Correlation between the Movement of the Dollar and the Price of Gold
- 1 Institute of Problem Solving, Dover Bay High School, ShangHai, 201100, China
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Abstract
Gold acts as a hedge to protect investors' assets. The U.S. dollar is a global currency and has an important place in international trade. Oil, on the other hand, is a non-renewable resource and an important international resource with unstable prices. This study used price data for the U.S. dollar, gold and oil from 2000 to 2023 to analyze the movement of gold, U.S. dollar and oil prices. The experiment uses a regression model to determine the effect of the dollar on the price of oil and gold. The study found a significant negative correlation between the U.S. dollar and the price of gold and an insignificant negative correlation with oil between 2000 and 2014. Between 2015 and 2023, there is a change in U.S. monetary policy, which leads to a weakening of the negative price correlation between gold and the U.S. dollar, but U.S. dollar still with the negative correlation with oil remaining weak. These results suggest that buying gold is the best way to protect your assets in times of financial crisis or market instability, but the US dollar and oil can change in price due to macroeconomic and political factors. To some extent these data provide a reference value for investment in the coming year.
Keywords
Dollar, gold and oil indices, correlation.
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Cite this article
Zhan,Y. (2024). Research on the Correlation between the Movement of the Dollar and the Price of Gold. Theoretical and Natural Science,41,126-131.
Data availability
The datasets used and/or analyzed during the current study will be available from the authors upon reasonable request.
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Volume title: Proceedings of the 2nd International Conference on Mathematical Physics and Computational Simulation
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