Gold’s Price Growth & Evolution Since 1971  

Although it might come as a surprise, the modern era of gold trading at free-market prices is a relatively recent development. Gold has been exchanged globally for thousands of years, but for much of that time, it served as the foundation of global monetary systems, typically maintaining a fixed relationship with silver and other currencies. 

For centuries, governments controlled gold’s value by pegging their national currencies to it, limiting its ability to fluctuate based on supply and demand. It wasn’t until the gold standard was dismantled that gold was finally able to trade independently on open markets, free from price controls and fixed exchange rates. 

Prior to 1900, the U.S. dollar was backed by a defined amount of silver. Beginning in 1900, the country shifted to a gold standard, officially defining the dollar as equal to $20.67 per troy ounce of gold, a fixed rate that would remain until dramatic policy changes in the 20th century. 

In Spring 1933 President Franklin D Rosevelt nationalized gold and banned private ownership (to prevent citizens from hoarding it and to transfer it into government possession), he paid Americans $20.67 per ounce. After collecting the gold, he unilaterally devalued the dollar by raising gold’s official price to $35 per ounce. The official gold price of $35 per ounce remained in place until August 15, 1971, when President Richard Nixon ended the dollar’s convertibility to gold, effectively severing the last formal tie between the U.S. dollar and gold. 

Even before that historic shift, global gold markets were already exploiting arbitrage opportunities, as gold persistently attempted to rise beyond the $35 cap. Throughout the 1960s, the London Gold Pool—a coordinated effort by central banks—worked unsuccessfully to keep gold fixed at that price. When Nixon ultimately ended gold convertibility, the metal was finally free to trade on open markets. 

After 1971, gold’s value began a steady climb. Over the decades, it has delivered strong long-term performance, averaging approximately 7.5% in annualized returns, which puts it in the same league as major equity benchmarks like the S&P 500 and Dow Jones Industrial Average. 

Gold’s performance since 2000 has truly stood out, delivering an impressive average annualized return of 10%— a rate that has consistently outpaced major stock market indexes. Over the past 25 years, the U.S. has faced three major economic crises, each more severe than the last: the 2001 Dot-com crash, the 2008 Great Recession, and the 2020 global pandemic. In every case, the government responded by printing increasingly massive amounts of money and taking on even more debt—temporarily propping up the economy, but at the cost of fueling larger financial bubbles and setting the stage for even deeper future crises. 

Meanwhile, U.S. debt has spiraled out of control. It’s no surprise that we’re now witnessing an accelerating global shift toward gold—as central banks and investors alike seek refuge in a historically reliable store of value. 

2025 marks a major milestone for gold, as it surpassed the euro to become the second most held reserve currency among central banks worldwide—trailing only the U.S. dollar, which has been steadily losing ground in its status as the world’s primary reserve currency.