XAU/USD definition

XAU/USD

XAU/USD is the label for spot gold traded on the foreign exchange market. Gold (XAU) is traded against the US dollar (USD), and its price represents the cost of one ounce of gold in USD. XAU/USD is traded on the forex marketplace like any traditional currency pair.

While gold is primarily traded against the US dollar, FOREX.com offers gold trading as XAU/EUR, XAU/GBP, XAU/CHF and XAU/AUD as well.

What drives the price of gold?

While gold is always seen as a safe-haven currency in times of financial instability, the precious metal’s price is affected by the overall health of the global economy. Gold prices typically move in contrast to the US dollar. So, factors like GDP growth, inflation, employment data, interest rates and the monetary policies of the world’s more influential central banks all affect the price of gold.

Supply and demand factors and market sentiment do not affect gold as much as they do silver, but traders should still keep an eye on them when trading the yellow metal.

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