The forecast of gold price based on the GM (1, 1) and Markov chain

Due to gold plays an important role in maintain value, investment and national economic stability , therefore, forecasting the trend of gold price exactly is undoubtedly important. In this paper, author firstly uses GM (1, 1) model to simulate and predict the international gold price. On the basis of the method, using Markov chain to divide and predict the relative error of GM (1, 1) model and amending the predictive value, thereby improving the accuracy of the forecasts of the international gold price and supplying the scientific decision-making suggestions to gold demander.