There are gold markets in London, New York, Zurich, and Shanghai to mention but a few. Each one of them has a spot price that gold is selling at that very second. Depending on the number of buy or sell orders that come in, that price can and does increase and decrease throughout the day continuously.
All though the markets are closely interlink and the prices do not fluctuate too much between them, but there are minor differences. Some of this has to do with the countries laws and regulations that pertain to gold itself. Other reasons that could cause gold prices differences could be the time of the day the market is open as compared to the other markets, or a breaking news story that gets to a particular markets buyers first.
Gold is a commodity, and some economic theorist, even consider it a currency. The factors that go into to determining what the price of gold is today; and what it will be in the future are extremely varied and complex. There is no single factor that controls the price of gold, although there are single events that can occur someplace in the world that can drastically effect its price.
Gold is also still being prospected for, and new discoveries are being made all of the time. If one of these new finds ever turns out to be a major supply of gold that could flood the market with the substance, this could have a drastic effect on its price.
The London gold price is a very strong indicator of how investors, financial institutions, and governments feel about the commodity at any given moment in time. In other words, if the price is rising, they will usually be worried about something. If the price is decreasing, they will believe it is a good time to be in other assets, like stocks or bonds, and will sell off their gold to accomplish this.