Precious Metal Prices
Although the U.S. is no longer on a gold or silver standard, the prices of these precious commodities still command widespread attention. One reason is that the price of gold is often considered an indicator of inflation. Over the past decade, however, gold prices have held steady or declined in the face of a slowly rising price level. As the pattern of the early 1980s demonstrates, gold prices can show substantial fluctuations unrelated to movements in the Consumer Price Index. In part, gold reacts to inflationary expectations, industrial demand and supply, and fears of political instability overseas.
Suggested citation: “Precious Metal Prices,” Federal Reserve Bank of Cleveland, Economic Trends, no. 97-05, pp. 07, 05.01.1997.