Impact of Inflation on Gold Price Fluctuations: A Time-Series Analysis
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Impact of Inflation on Gold Price Fluctuations: A Time-Series Analysis
Authors:
*1Dr K Lakshmana Rao 2N Nirmala Kumari, 3Madem Kishore 4Dr K Anjaneyulu,
*1Lecturer in Commerce – Pithapur Rajah’s Government College (A) Kakinada,
Andhra Pradesh-533001, India. lakshman.dsp@gmail.com
2Lecturer in Commerce – Visakha Government Degree College for women (A), Visakhapatnam, Andhra Pradesh, India nimmu1974@gmail.com
3Lecturer in Commerce – S.G.A., Government Degree College (A),Yellamanchili,
Anakapalli District - Andhra Pradesh, India kishorekumare141@gmail.com
4Lecturer in Philosophy – Pithapur Rajah’s Government College (A) Kakinada,
Andhra Pradesh-533001, India. k.anjaneyul@gmail.com
Abstract: Inflation is a key economic indicator that influences various asset classes, including gold. This study examines the impact of inflation on gold price fluctuations through a time-series analysis, considering historical and recent fluctuations. Gold has long been considered a hedge against inflation, but its price movements are subject to multiple macroeconomic variables. This research utilizes time-series econometric models, including ARIMA and GARCH, to analyze the correlation between inflation rates and gold prices over time. By studying historical trends and inflation indicators such as the Consumer Price Index (CPI), the research provides valuable insights into the investment behaviour of individuals and institutional investors. The findings indicate a strong positive relationship between inflation and gold prices, particularly during economic crises. This study contributes to understanding how inflationary pressures influence gold as an investment asset and offers strategic insights for policymakers, investors, and financial analysts in making informed decisions regarding gold investments during inflationary periods.
Key words: Inflation, Gold Price Fluctuations, Time-Series Analysis, Econometric Models, Safe-Haven Asset
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