gold standard

A system in which a nation's currency has a value measured in gold and can be exchanged for gold. Most nations, including the United States, went off the gold standard in the 1930s.

Gold Standard

A monetary system in which a country's currency unit is freely convertible into fixed amounts of gold.

Investopedia Commentary

The gold standard has lost its popularity. The U.K. was taken off in 1931, and the U.S. was taken off in 1971.

Related Links

Using Technical Analysis in the Gold Markets
The Gold Standard Revisited
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See also: Bullion, Economy, Fiat Money, Fool's Gold

gold standard

A monetary system under which a country's money is defined in terms of gold and convertible into a fixed quantity of gold. A gold standard effectively takes monetary policy out of the hands of government policymakers. While use of the gold standard reduces the likelihood of inflation, the accompanying inability to pursue other economic goals, such as full employment or reduced interest rates, has resulted in the gold standard's fall from favor.