RE:Depends on the currencyStockwatcher
You are taking the statement out of context. Gold has an inverse relationship to currency generally speaking. The USD rises the rupee falls so the price of gold in rupees rises. However, your statement is not incorrect just not valid to the post the way you are thinking.
The true affect of currency is actually in the operational cost of a gold mine in the given country. The three largest cost from an operation stand point in a gold mine is labour, fuel and power. So when the US dollar rises the Canadian dollar often falls. Labour rates expressed in US dollars goes down so one of the largest operation inputs gets cheaper!
So Canadian operational cost have essentially gone down. That said, is it enough to offset inflation and other costs such as power and fuel.
Needless to say the fall in the Canadian dollar and rise in the US currency can have a serious negative relationship as far as the Cap Ex required to build a new mine as the input costs are usually in US funds so both the cost to build rises as does the cost of financing as you are financing a larger sum of money.
Bottom line the POG expressed in US funs must rise in order for low grade operations to succeed!