Gold is back above 1.800 $ per ounce
We cannot resist to start the week writing about gold again. There used to be a strong inverse correlation between the gold price and real interest rates, the difference between nominal interest rates and inflation. The rationale is that less we earn after inflation by investing in bonds, the more attractive it becomes to hold gold as a store of value. The relationship has currently broken down: real interest rates touch record ( negative ) yields while gold is not rallying as it should. This looks unsustainable with inflationary pressures at the gates.