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Gold sank to an 18-year low near $273 in August 1998 as the Asian crisis spread to Russia and LTCM, then recovered to end the year roughly flat.
Monthly path for 1998, anchored to the real open ($ 290.00), the high in April, the low in August, and the close ($ 288.00). The dashed line marks the yearly average; intra-year movement between anchor points is illustrative.
Year-over-year, gold fell -0.69% versus its 1997 close of $ 290.00.
On paper 1998 looks uneventful — gold ended the year almost exactly where it began — but the path was anything but calm. The financial contagion that started in Asia in 1997 reached Russia in August, and the resulting default toppled Long-Term Capital Management, one of the world’s largest hedge funds. Remarkably, gold offered little refuge: deflationary fear and forced selling pushed it to roughly $273 in late August, its lowest point since 1979.
The autumn brought stabilization rather than revival. Three quick Federal Reserve rate cuts calmed markets, and gold drifted back toward $290 by year-end. Sentiment toward the metal remained dismal — central banks were sellers, inflation seemed defeated, and equities were the only game in town — setting the stage for the capitulation low of 1999.
Russia defaulted on its domestic debt in August, deepening the emerging-market crisis that began in Asia.
The hedge fund Long-Term Capital Management collapsed in September, forcing a Fed-orchestrated rescue.
Gold touched roughly $273 in late August — its weakest level since 1979.
European central banks prepared reserves for the euro launch, keeping official-sector selling in focus.
Gold averaged about $294 per ounce in 1998, trading between roughly $273 in August and $313 in the spring, and closed near $288 — essentially flat for the year.
The Russia/LTCM crisis was deflationary: investors fled to US Treasuries and dollars, not gold, while ongoing central-bank sales and two decades of falling inflation kept sentiment against the metal.
Gold's 1998 high was about $ 313.00 per troy ounce, reached in April.
The average gold price in 1998 was roughly $ 294.00 per troy ounce — it opened near $ 290.00 and closed around $ 288.00.
Gold fell about 0.7% over 1998, between a low of $ 273.00 and a high of $ 313.00.
Historical figures are approximate annual values shown for educational analysis and may differ from other sources. This is not financial advice — see our disclaimer.