This document examines the historical relationship between US presidential elections and gold prices. It finds that gold performance around elections is complex, with prices rising or falling under both Republican and Democratic administrations. While gold has become more responsive to macroeconomic factors since the 1970s, there is no clear linear pattern between political parties and gold. The document tracks gold prices in election years since 1980, finding volatility increases around elections but no consistent pattern. It concludes that many factors influence gold, making the impact of any single election uncertain, particularly in today's economically challenging environment.

1. US Presidential Election Timeline
And Implications For Gold Prices

2. Points To Be Discussed Today:
• US Presidential Election & The Price Of
Gold
• Change In Gold Prices During Election
Years
• The Historical Impact
• Gold Performance In Election Years
• Tracking The Performance Of Gold Prices

3. US Presidential Election & The Price Of Gold
• The US Presidential election has a historical
tendency to influence financial markets as a
change in leadership often brings a shift in
fiscal policy.
• For the price of gold, there has been greater
responsiveness to the macroeconomic
landscape change since President Richard
Nixon took steps to end the Bretton-Woods
system starting in 1971.

4. Change In Gold Prices During Election
Years

5. The Historical Impact
• However, a look at the historical impact of the US
Presidential election offers little evidence of a
linear relationship between the price of gold and
the outcome based on party affiliation.
• Bullion struggled under Clinton, while the
precious metal traded to a record high price in
2011 with Obama in the White House.
• The same could be said about Republican
candidates as gold prices weakened during the
Regan era, but increased during the two terms
under George W. Bush.

6. The Historical Impact - I
• Efforts to attribute a specific market reaction
based on a candidate’s party affiliation is a
practice of nuance especially when external
fundamental factors like seasonality and
economic cycle are taken into consideration.
• Many contrasting observations can be made
from different regimes as financial markets
have seen bubbles and crashes during various
presidencies.

7. The Historical Impact - II
• Nevertheless, one observation to apply to the
unique situation of present conditions is that
gold prices have become more volatile in the
21st century.
• It remains to be seen if the trend will hold
for the 2020 election as the economic shock
from the COVID-19 pandemic clouds the
macroeconomic outlook.

8. Gold Performance In Election Years

9. Tracking The Performance Of Gold
Prices
• Tracking the performance of gold prices during
election years may help to shed some light by
looking at the average performance in the
year preceding and following elections since
1980.
• The study reflects the precious metal (red line)
rallying at the start of the year, but hitting a
peak in the second-half to trend lower in
November.

10. 1980 –Ronald Regan
• In 1980, the price of gold hit a
high of $850 in January as the
Federal Reserve under Chairman
Paul Volcker was on course to
push US interest rates towards
20% to curb inflation, but the
advance from the start of the
year was short-lived as the
precious metal registered the
1980 low ($482) in March.
• Bullion recovered to trade above
$600 ahead of the November 4
election, but consolidated
throughout the remainder of the
year to hold around $590 ahead
of 1981.

11. 1984 – Ronald Regan (R)
• In 1984, gold prices briefly traded
above $400 in March as the Federal
Reserve pushed the benchmark
interest rate back above 10%, with
Chairman Volcker still at the helm
after being nominated to serve a
second term in 1983.
• Bullion gradually weakened over the
coming months, with the November
6 election doing little to prop up the
precious metal even though
incumbent Ronald Regan won a
second term.
• In turn, the price of gold continued
to drift lower following the 1984
election to register the yearly low
($308) in December.

12. 1988 – George Bush (R)
• In 1988, the price of gold
registered the yearly high
($482) in January, but dipped
below $400 in September as
the effective Federal Funds
rate increased ahead of the
November 8 election, with the
US central bank led by Alan
Greenspan, who was
nominated by Regan in 1987.
• The victory by Bush did little to
sway gold prices, with bullion
trading sideways throughout
the remainder the year to end
1988 around $410.

13. 1992 – Bill Clinton (D)
• In 1992, bullion held above $350 until
March, with the precious metal weakening
throughout the first half of the year even
though the Federal Open Market
Committee (FOMC) stuck to its rate easing
cycle following the recession in the early
1990’s.
• Chairman Greenspan continued to cut US
interest rates ahead of the November 3
election after being reappointed by Bush
in 1991, but the price of gold remained
under pressure after Clinton won the
presidency, with the precious metal
registering the yearly low ($332) just days
after the election.
• Gold traded in a narrow range for the
remainder of the year, with bullion ending
1992 around $335.

14. 1996 – Bill Clinton (D)
• In 1996, gold climbed above $400
during the first quarter as the
Federal Open Market Committee
(FOMC) kept US interest rates
unchanged, with Chairman
Greenspan still at the helm after
being reappointed for a third
term earlier in the year by
Clinton.
• However, the price of gold held
below $400 throughout the
remainder of the year even
though Clinton won a second
term, with bullion quickly giving
back the rebound following the
November 5 election to close out
1996 around $368.

15. 2000 – George W. Bush (R)
• In 2000, the price of gold recovered at the
start of the year even though the FOMC
continued to embark on its rate hiking
cycle from 1999, with the precious metal
trading above $300 in February.
• However, the price for bullion declined in
the incoming quarters even though the
FOMC had implemented its last rate hike
in May, with the precious metal marking
the yearly low ($264) just days after the
November 7 election.
• Gold prices nudged higher over the
remainder of the year to end 2000 around
$272 as Fed Chairman Greenspan, who
was serving his fourth term after being
reappointed by Clinton, kept US interest
rates on hold.

16. 2004 – George W. Bush (R)
• In 2004, the price of gold traded as
high as $426 during the first quarter
as the Federal Reserve kept US
interest rates at 1.00%, but slipped
below $400 on numerous occasions
ahead of the November 2 election as
Chairman Greenspan, who was
serving an unprecedented fifth term
after being reappointed by George W.
Bush, began hiking rates in the
second half of the year.
• Gold prices increased after Bush won
his second term, with bullion
registering the yearly high ($456) in
December.

17. 2008 & 2012– Barack Obama (D)

18. 2016 – Donald Trump (R)
• In 2016, the price of gold started
off the year below $1100 as the
FOMC led by Chair Janet Yellen
increased US interest rates at the
end of 2015, but traded as high as
$1366 in July as the central bank
kept the Federal Funds rate in a
range of 0.25% to 0.50%.
However, gold prices slipped
below $1300 ahead of the
November 4 election, with the
victory by Donald Trump doing
little to shore up the precious
metal as bullion closed out the
year around $1148.

19. 2020 - ?
• Since the collapse of the Bretton-Woods system,
various fundamental factors can be attributed to the
changes in the price of gold, but a look at the timeline
of the US Presidential election offers little evidence of
a linear relationship between bullion and party
affiliation even though the precious metal has become
more responsive to the macroeconomic environment.
• With that said, the study does indicate that gold prices
have become more volatile in the 21st century, and it
remains to be seen if the trend will hold beyond the
2020 election as the precious metal trades to fresh
record highs this year.

20. US Presidential Election Timeline
And Implications For Gold Prices

21. Thanks for listening
US Presidential Election Timeline
And Implications For Gold Prices