Gold’s Trajectory is Breaking Away from Traditional Correlations
Gold is displaying unusual strength despite a combination of market conditions that would traditionally be expected to weigh heavily on its price. The greenback has strengthened, the Fed remains restrictive, and the 10-year Treasury yield has climbed toward 5.2%, a level not seen in roughly two decades. Under historical relationships, such a rise in Treasury yields should have placed considerable downward pressure on gold. An analysis indicates that, all other factors held constant, a 25bps rise in the yield on 10-year bonds can correspond with approximately a 1.7% drop in the precious metal. Based on that relationship, gold would theoretically…
