The answer is more complex than what is simply presented here, but generally speaking, there are some key factors that influence the price of gold: including gold production, product demand (such as jewelry), bank reserves, the value of the U.S. dollar, and market volatility, amongst others.
Gold has long fascinated economists and investors. Recently, banks have added more gold to their reserves, which can increase its price. Generally speaking, gold prices increase when the U.S. dollar value goes down and decreases when the dollar is strong, making it a fairly reliable hedge against inflation. Gold is also used in products like jewelry, so when these products are in high demand, gold prices typically go up as its supply is limited. Certain global or political situations, like the Covid-10 pandemic, can also affect gold prices as some consumers turn to the precious metal during volatile and uncertain times.
