The Surge in Gold Price Volatility: Macroeconomic Drivers, Geopolitical Risk, and Market Dynamics

Gold has for long been considered a store of value, an inflation hedge, and a safe-haven asset during times of financial turmoil. The historical patterns in gold prices, the primary movers of price variability, and the behaviour of gold in relation to the world’s financial markets are the topics of this study. The results point out that macroeconomic indicators like inflation, interest rates, and exchange rates strongly impact gold price fluctuations, and geopolitical threats and monetary policy also play an important part. Central bank gold reserve function has transformed with more diversification schemes by economies to avoid currency risks and financial turmoil. Considering the increasing price volatility in gold, this research also investigates policy suggestions to stabilize gold markets through strategic reserve management, regulatory interventions, and financial instrument diversification related to gold. The research also identifies areas of limitation, including the lack of behavioural finance dimensions and the effects of emerging financial technologies. Future research directions include the impact of AI-based price prediction models, blockchain gold trading, and central bank digital currencies (CBDCs) on price stability in gold. Through the integration of financial econometrics, behavioural finance, and technological advancements, this work is part of the pursuit of greater understanding of the changing role of gold in contemporary financial markets.