Economics & Sociology

ISSN: 2071-789X eISSN: 2306-3459 DOI: 10.14254/2071-789X
Index PUBMS: f5512f57-a601-11e7-8f0e-080027f4daa0
Article information
Title: Gold Investment Incentives: An Empirical Identification of the Main Gold Price Determinants and Prognostication of Gold Price Future Trends
Issue: Vol. 11, No 3, 2018
Published date: 09-2018 (print) / 09-2018 (online)
Journal: Economics & Sociology
ISSN: 2071-789X, eISSN: 2306-3459
Authors: Ligita Gaspareniene
Lithuanian Institute of Agrarian Economics

Rita Remeikiene
Lithuanian Institute of Agrarian Economics

Alius Sadeckas
JCC “Ekskomisarų biuras“, Vilnius, Lithuania

Romualdas Ginevicius
Vilnius Gediminas Technical University
Keywords: gold price, gold price variation, autoregressive model
DOI: 10.14254/2071-789X.2018/11-3/15
Index PUBMS: e8e85a07-ce10-11e8-92b1-901b0efa6e97
Language: English
Pages: 248-264 (17)
JEL classification: D20

During the World War I, most of the countries stopped coin production and began converting paper money into gold. Various forms of exchange were later abolished during the "Great Depression" in 1929-1933. Later, gold lost the value of money in most of the economies worldwide. Multiple price rise of gold caused a real rise in the value of gold reserves and their potential ability to cover the balance of payment deficit. At the same time, it shows that gold still plays an important role in terms of monetary aspect. The aim of this study was to determine whether ARIMA models are suitable for determining the short-term volatility of gold prices. The calculations show that ARIMA model is suitable only for short-term gold price forecasts (max. 1 year). Thus, it is necessary to apply other models (multi-regression ones) that also can reveal the relationship between gold price and its determinants.


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