Gold plays an additional role, which is to serve as a store of purchasing power. It can also be used in productive processes but the bulk of gold demand comes from its use as a reserve.
Transactions in the gold market take place 24 hours a day even though markets are in different time zones. Gold is traded in us dollars even though the major exchange is in London.
Gold is known as what's called a neutral as it is not tied to any country in particular so the price of gold is not under the influence of government. Gold is an important mover of the forex market and it makes for a good euro journal.
As a reserve the price of gold is tightly tied to the behavior of other non related investment alternatives like bonds, equities and currencies. The price of gold tends to appreciate time of political or monetary instability and low liquidity. Other events such as natural disasters can also affect the price of gold.
