The Role of Gold in the Modern Economy

• Published in: Finansy: teoriâ i praktika (Online) Vol. 29; no. 2; pp. 238 - 250
• Main Authors: Sotnikov, D. S., Zhuravleva, O. V., Varvus, S. A., Buevich, A. P.
• Format: Journal Article
• Language: English; Russian
• Published: Government of the Russian Federation, Financial University 09.05.2025
• Subjects: financial instruments of the gold market; gold bond index; gold market; gold reserve; price forecast
• ISSN: 2587-5671; 2587-7089
• DOI: 10.26794/2587-5671-2025-29-2-238-250

The subject of the study is the role of gold in the economy and its prospects as a financial instrument. Gold has been a valuable asset for several millennia, capable of performing the functions of money, and even after demonetization remained an important financial asset and resource for industry, which is largely due to its unique natural characteristics. Gold is capable of yielding an average annual yield of about 15%, which makes it profitable for both private investors and governments to invest in this asset. The purpose of the study is to determine the modern role of gold and its prospects as a financial instrument. The study should help to understand how the role of gold in the economy has changed and what it is today. In addition, the study can help identify the potential of gold as an asset in the financial market, based on a serious theoretical and historical basis. The paper analyzes the gold market and identifies factors affecting the price of gold; based on the analysis of the dynamics of gold prices, their correlation with the consumer price index was revealed. The financial instruments of the gold market are considered and the differences between them are formulated. The presented index “Index of gold bonds” allows you to track the dynamics of the market and create a diversified investment portfolio of this type of securities. A theoretical analysis of the scientific and methodological literature was carried out; generalization and systematization of the theoretical aspects of the research topic. The historical method, the economic and statistical method, the mathematical method, the practical synthesis and processing of information were also used, which made it possible to process and describe the results of the study. Based on the results of the work carried out, it  can be concluded that gold, having unique natural properties that determine its rarity and usefulness in the economy, allows its owners to receive sufficient average annual returns to beat inflation. Secured and physical gold was, and still is, a hedge asset against infrastructural instability, and therefore is necessary for the structure of the population’s “safety cushion” and the state’s international reserves.