Table of Contents
For years, the precious metals market has attracted many individuals looking to diversify their investment portfolios and secure financial freedom through the purchase and sale of gold, silver, and more. Gold products in particular remain the most popular among investors, as this precious metal has unmatched durability, impressive resistance to corrosion, and a historical value that dates back centuries.
Nations today aren’t on the gold standard, as most countries use paper currency. Prior to 1934, the U.S. government provided gold certificates, which served as proof that an institution held a certain amount of gold. Today, a gold certificate is a collectible item.
Although using gold as currency is no longer a common practice, many countries have stores of physical gold to use as a fallback in the event of an economic crisis. This practice is among the various factors that influence the price of troy ounces of gold. Gold is already a scarce precious metal given how challenging it is to mine, so when the geopolitical and economic landscapes of major gold suppliers change, so too does the price per pound of gold.
Many other factors influence the price and value of gold from day to day, which can create some concerns for investors hoping to fetch the highest price for their gold bars, coins, and bullion. However, gold bullion bars and coins have a reputation for being among the safest investments, despite the price of gold updating constantly during market hours.
Whether you’re new to precious metals investing or simply want to learn more about the value of your current stock of gold, you may be wondering: how much is a pound of gold worth in 2023? At the time of writing this article, the spot price of gold is $1,853.98 per troy ounce. Given that there are 12 troy ounces in a troy pound, the current spot gold price for one pound is $22,247.76.
However, it’s important to remember the weight most commonly sold by manufacturers and retailers is troy ounces. It’s possible to purchase a troy pound of gold, but most vendors don’t sell gold by the troy pound.
Likewise, this is merely the current gold price, and it’s subject to change at any moment. To better understand how the current spot price of gold can change and the many factors that influence it, let’s take a look at some historical data and examine how the gold price has shifted in the last decade.
How Much Was a Pound of Gold Worth in Recent Years?
How much is a pound of gold worth? It’s fairly easy to calculate the current gold price per pound, but the value of a troy ounce of gold has shifted dramatically in the last ten years or so. Before investing in and buying gold bullion, coins, or bars, it’s essential that you familiarize yourself with how the value and price of a gold product can change in the long term.
Gold Price From 2009-2011
In 2009, the price of gold by the troy ounce fluctuated around $1,300. By late 2011, the spot price of gold had risen by nearly $1,000, with the gold spot price coming to a peak of around $2,300. In fact, the Producer Price Index saw a 101.1% surge in the gold spot price from 2008 to 2012.
This significant increase in the price of gold per ounce was likely a result of the 2008 recession, when the value of the U.S. dollar dropped as result of the U.S. government’s outstanding account deficit. The U.S. economy was experiencing a crisis, during which time many investors sought gold to protect their financial interests.
Historically, the spot price of gold has risen during periods of economic peril, as many individuals and institutions use gold as a means of financial protection, whereas times of economic stability generally see the price of gold trend downward as investors focus on more speculative interests. In 2011, U.S. financial markets were still trying to recover from the recession, which ultimately led to an increase in the value of gold.
Price of a Troy Ounce of Gold From 2012-2013
After climbing for nearly four years and reaching an all-time high at the end of 2011, gold prices began to shift at a much slower rate in 2012.
Still, the market price of physical gold stayed mostly stable for the remainder of the year, as lower interest rates encouraged more investing in gold and other precious metals. As more investors chose to purchase gold, the demand for the metal continued to rise, which kept gold’s value around $2,100 per troy ounce.
However, 2013 saw one of the most significant drops in gold prices in recent memory. After several years of economic instability and a weakened U.S. dollar, inflation finally began to recede. Meanwhile, long-term interest rates rose, a factor that will almost always influence the spot price of precious metals.
Experts have attributed this drop in the gold spot price to a few key factors:
- Many investors buy gold coins, bullion, and bars as a hedge against inflation. When inflation begins to recede, and economic stability returns, individuals have less incentive to protect their fortune with gold bullion.
- Similarly, higher interest rates generally encourage individuals to sell gold to fetch a higher bid price. This increases the supply of gold in the precious metals market, which can cause the value of gold to decrease. Conversely, when interest rates trend down, more people tend to invest in gold bullion, which creates a higher demand for gold and generally increases its value.
Because inflation decreased and interest rates increased in 2013, the precious metals market saw an overall decline in the value of gold.
Gold Spot Price From 2013-2019
The price of gold per troy ounce continued to decline in 2013 and 2014, with the spot price of one troy ounce reaching a significant low point in 2015. Similar to previous years, 2015 saw an increase in federal interest rates and a decrease in the demand for gold coins, bars, and jewelry. As a result, the gold value continued to decline, with the market price dropping to the lowest it had been since 2010.
The value of gold bullion, coins, and bars continued to ebb and flow from 2014 to 2018, with 2018 marking the beginning of a gradual increase in gold prices. In 2019, however, economic shifts and geopolitical conflicts led to a substantial increase in gold’s value as the price of gold per troy ounce climbed over $1,300 in June.
Gold Price Per Troy Ounce From 2020-2023
As noted previously, periods of economic hardship usually cause gold prices per troy ounce to increase as investors seek to safeguard their financial future. The first year of the COVID-19 pandemic was one such period.
The financial difficulties created by the pandemic urged many into buying and selling gold, with troy ounces of gold priced around $1,800 by early 2020. Since then, the value of gold coins, bullion, and bars has steadily decreased, though experts predict that prices will increase again by mid-to-late 2023.
How the Price of Precious Metals Correlates With Other Investments
How much is a pound of gold worth compared to other assets? Whether you’re buying and selling gold in troy ounces, by the troy pound, or looking to open a gold IRA, diversifying your portfolio requires you to evaluate your other investments alongside gold, silver, and other precious metals.
Generally speaking, the stock market and gold have an inverse relationship. In most cases, if the stock market is performing positively, gold’s price by the ounce decreases — though the two will, occasionally, trend in similar directions.
The general rule for bond investments is fairly straightforward: the lower the bond price, the greater the expected return. Like gold, bonds have a reputation for being a safe-haven asset, or an asset that individuals can rely on when other investments perform poorly. For this reason, gold has a positive correlation with bond prices. However, the correlation is negative when it comes to gold and bond yields, as yields are essentially interest rates in the context of bonds.
Real estate and gold are both physical assets. However, the two don’t typically shift together, nor do they appear to have any significant correlation.
Some cryptocurrency enthusiasts suggest that crypto has a comparable value to gold. However, the fairly recent advent of cryptocurrency makes it challenging to pinpoint its exact correlations with other assets. Based on available data, gold seems to provide a safer and more consistent hedge against inflation than cryptocurrency.
How the Price of Gold Troy Ounces Correlates With Inflation
Among other factors, inflation seems to heavily influence the cost of gold, as many see gold as an effective hedge against inflation. However, this isn’t universally true.
For example, during Ronald Reagan’s presidency in the early 1980s, the U.S. was experiencing a recession and increased inflation — two factors that ordinarily cause the cost of gold to rise. However, tax cuts provided some financial security for Americans, so the demand for precious metals was low. This is why it’s critical to examine the economic landscape as a whole.
If you are interested in investing in gold after reading this article, purchase gold and have it delivered straight to your home with Oxford Gold Group. Give us a call at (833) 600-GOLD or contact us today!