Interest in gold has surge In recent weeks, the price of an ounce hit an all-time high of $5,600 on January 29 before falling back to just under $5,000 on Sunday.

As economic conditions fluctuate and geopolitical tensions rise, more personal Looking for gold as a safe investment.

In this visual explanation, Al Jazeera details how the value of gold is determined, the price of gold coins in different markets and which countries hold the largest reserves.

How is the value of gold measured?

Knowing the value of a gold item requires knowing its weight in troy ounces and its purity in carats.

Weight (troy ounces)

The weight of gold and other precious metals such as silver and platinum is usually measured in troy ounces (oz t). One troy ounce is equal to 31.1035 grams.

At $5,000 per troy ounce, 1 gram of gold is worth approximately $160, and a standard 400 troy ounce (12.44 kilogram) gold bar costs $2 million.

The troy ounce is different from the regular ounce, which weighs 28.35 grams and is used to measure everyday items including food.

Purity (in carats)

A carat or carat (abbreviated as “K” or “ct”) measures the purity of a gold item. Pure gold is 24 karat, while lower karat sizes such as 22, 18 and 9 karat indicate gold mixed with cheaper metals such as silver, copper or zinc.

To determine the purity of gold, a jeweler needs to stamp a number on the item, such as 24K or a numerical value such as 999, which indicates that the gold is 99.9% pure. For example, 18K gold usually carries a 750 mark, indicating that it is 75% pure.

Some typical values ​​include:

• 24 carat – 99.9% pure – Dark orange, very soft, never tarnishes, most commonly used for investment coins or gold bars
• 22 carat – 91.6% purity – Rich orange color, medium durability, resistant to tarnish, most commonly used in luxury jewelry
• 18 carat – 75% purity – Warm yellow, highly durable, tarnishes somewhat over time, most commonly used in fine jewelry
• 9 carats – 37.5% purity – Light yellow for maximum durability, darkens over time, used in affordable jewelry

Other carat quantities, such as 14k (58.3% purity) and 10k (41.7% purity) are often sold in different markets around the world.

When you buy jewelry, the price is usually determined by the spot price of gold that day, the cost of making it, and any taxes.

If you know the exact weight of the item in grams and the purity of the gold in carats, you can calculate the crafting cost.

You usually can’t negotiate the spot gold price, but you can often bargain on the cost of the process.

The price of gold has quadrupled in the past 10 years

Gold has been valued for thousands of years and has many functions, from currency to jewelry. Precious metals are widely viewed as safe-haven assets, especially during times of economic uncertainty or market volatility.

Prior to 1971, the U.S. dollar was effectively defined by a specific weight of gold. Under the classical gold standard, for nearly a century from 1834 to 1933, you could walk into a bank and exchange $20 for an ounce of gold.

In 1933, during the Great Depression, the price of gold was raised to $35 per ounce in order to stimulate the economy.

In 1971, under President Richard Nixon, gold was decoupled from the U.S. dollar and its price began to be determined by market forces.

Over the past decade, the price of gold has quadrupled from $1,250 in 2016 to around $5,000 today.

How are gold prices determined in different countries?

Gold is priced globally based on the spot market, with one troy ounce trading in U.S. dollars on exchanges such as London and New York. Local prices change as the U.S. dollar exchange rate converts to local currency, and dealers add premiums based on mintage, distribution, and demand.

Taxes and import duties further impact the final cost: India adds a 3% goods and services tax, while the UK and the United Arab Emirates impose no duties on gold investments.

Different countries produce unique gold coins and bars, each with its own unique characteristics and cultural significance. Notable examples include the American Gold Eagle, the Chinese Gold Panda, and the South African Krugerrand.

Which countries have the largest gold reserves?

The United States leads the world with 8,133 tons of gold reserves, almost equal to the next three countries combined. Germany ranked second with 3,350 tons, and Italy ranked third with 2,451 tons.

The chart below shows the top 10 countries with the largest gold reserves.