Dynamic Changes in Prices of Gold and Silver during Russia-Ukraine Conflict

Authors

  • Xinshu Li

DOI:

https://doi.org/10.54691/bcpbm.v31i.2646

Keywords:

Russia-Ukraine conflict; crude oil price; precious metal.

Abstract

The Russia-Ukraine conflict has upraised the crude oil price and its volatility, which leads to fluctuations in its corresponding industries and markets. Existing literatures have studied the impact of the oil shock in many respects, and the precious metal market has significant responses to the unusual events, same for the Russia-Ukraine conflict. This paper studies the spot gold and silver’s price, return, and volatility with respect to the return and volatility of WTI, during the period of November 2021 to July 2022. The VAR model proved the lead-lag relation of the variables. Next, the impulse and response of gold and silver to crude oil show positive relations of the two metals to the increment in crude oil’s price. Then the author estimated the ARMA-GARCH model to detect the relationship of volatilities of crude oil to the two metals. The results show that the increasing crude oil price leads to growth in the metal’s return, and the silver’s volatility is more impacted by the crude oil’s fluctuation.

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Published

2022-11-05

How to Cite

Li, X. (2022). Dynamic Changes in Prices of Gold and Silver during Russia-Ukraine Conflict. BCP Business & Management, 31, 318-326. https://doi.org/10.54691/bcpbm.v31i.2646