Abstract
The current research examined the macroeconomic determinants of Peruvian gold exports in the period 2003-2019 as well as their relative importance. Regressors employed were inflation, exchange rate, international rate, interest rate and Swiss gross domestic product. Ordinary Least Square along with decomposition and standardized coefficients were employed. The research found positive effects of inflation and international gold price on the dependent variable; while, Swiss gross domestic product was found to have a negative effect to Peruvian gold export. By the usage of decomposition and standardized coefficients it was found that international gold price is the most relevant regressor when explaining Peruvian gold export values.
Highlights
Gold is one of the most valued metals around the world
The research found that gold international prices and inflation had a positive effect on Peruvian gold export; while Swiss gdp had a negative effect
Inflation, exchange rate, international rate, interest rate and Swiss gdp were chosen as potential explanatory factors
Summary
Gold is one of the most valued metals around the world. Gold is seen as a store of wealth; and in the other hand, gold is employed for electric devices and jewelry (Fabozzi et al, 2008). Just focusing on its value as an investment asset, gold is often seen as the least risky investment (Ahmed & Vveinhardt, 2018). Gold investors harness gold for defending themselves from inflation, financial crisis and other externalities (Shakil et al, 2018). Gold, as every commodity, has inherent volatility because of their dependence on international prices (Fabozzi et al, 2008). Gold price may suffer reductions on its value in the international markets impacting in both gold investors and producers
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