The XAUUSD trading instrument belongs to metals and shows a ratio of gold and US dollar. In this trading instrument, the base role is played by precious metal — gold, and the US dollar is exposed to converting. Sometimes this trading instrument is designated by a GOLD symbol. Gold has a considerable impact on the international exchange market as representing a fundamental cash form of any currency. Gold is the guarantor of stability of any currency, for this reason, the gold and exchange inventories of the state are higher, the more stable it is currency and the economic situation. Gold possesses intrinsic value, and won't lose it irrespective of the conditions dictated by the modern economy.
The average level of demand for the XAUUSD trading instrument constitutes about 4000 tons per year. However, an annual reduction of natural inventories of this precious metal conducts to demand growth and according to gold value.
In the modern financial markets, the cost of gold is generally determined by American dollar. When gold increases in the price, the US dollar weakens that is substantially reflected in other currencies of the world. The world inflation daily reduces the cost of paper money, strengthening XAUUSD positions more and more.
The rate of this trading instrument is influenced by economic and geopolitical events from around the world, for this reason, XAUUSD differs in raised volatility. Especially sensitively the tool reacts to fundamental factors, important news releases, and also general market biases.