Commodity prices, inflation and the price of goldThere is no direct relationship between rising inflation and the price of gold but there is an indirect relationship. Higher commodity prices and money printing (another 1.9 trillion USD on it's way) create inflation which destroys overstretched stock evaluations which leads to a bear market which destroys market sentiment which is good for gold.
We are at the very beginning of that chain reaction. Keep your eyes on the inflation rate and any corresponding weakness in the equity markets.
Over the last few weeks some big players have bet on the bull market continuing for the forseeable future. The entire gold sector has sold off and pulled back. Barrick is down to 25.3 CAD.
I remember the 20% inflation rate of the 1970s! My first motgage was at 11%. I am not a believer in this zero interest rate - zero inflation environment lasting much longer. In my opinion this is the time to be buying gold and gold producers.
Then again, who knows! The great crystal ball says ....