By 1982 the air had gone out of the great 1970s bull. Fed Chairman Paul Volcker's interest rates, which had peaked near 20%, had broken inflation — and gold's appeal with it. The price had fallen hard from its 1980 high.
But the year was not without drama: in August, Mexico's default triggered the Latin American debt crisis, and gold staged a sharp relief rally as fears of a banking crisis spread. It proved temporary. The metal was now in a secular decline that, with fits and starts, would run all the way to the 1999 bottom.
Key events of 1982
- 1982-08-12
Mexico defaults
Mexico’s default opens the Latin American debt crisis; gold rallies briefly on banking fears.