Economic Analysis: Theory and Practice

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Analyzing the global gold market and its development trends

Vol. 18, Iss. 5, MAY 2019

Received: 25 December 2018

Received in revised form: 18 February 2019

Accepted: 7 March 2019

Available online: 30 May 2019


JEL Classification: E2, F10

Pages: 910–924

Kosov M.E. Financial University under Government of Russian Federation, Moscow, Russian Federation

ORCID id: not available

Subject In today's volatile global economy and political situation, gold is a particularly important asset for any financial and economic system. The global gold market has a number of obstacles to its development. Despite the transparency of information provided by exchanges, the largest producers, and government agencies, the market is fragmented, and the data on the total market size is collected from various sources and estimates, and is often scattered.
Objectives The purpose of the study is to analyze the global gold market, determine its development trends and barriers to its growth.
Methods I employ methods of measurement, comparison of statistical information, analysis and synthesis.
Results The paper discloses tendencies, problems and barriers to the gold market development. The findings may be useful to foster the gold market in Russia, to adjust it to external environment.
Conclusions As part of international reserves, gold tends to grow due to high level of trust. There is a potential for investment demand growth. The global gold market is characterized by erratic quotes and dependence of pricing on investment factor and speculative demand, monopolization by the largest players, reduction in explored reserves and deteriorated quality of new deposits, high costs at low prices. These factors lead to negative profitability and bankruptcy of some of the largest companies, market imperfection, and information asymmetry.

Keywords: global market, gold, gold and foreign exchange reserves, central bank


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