Gold vs. Inflation Expectations

I have a page with several chart based indicators for NFTRH subscribers to review any time they’d like in order to dovetail what they may see there with the ongoing analysis in NFTRH and their own alternate sources as well.

One of those indicators is the GLD/RINF ratio, which measures the gold price in terms of the variables that make up ‘inflation expectations’ ETF.

Here is the description per that page:

Above we see the ratio bouncing hard but not trending up. We also see it at a chart based decision point (resistance, if you believe a ratio can have resistance).

What I find more interesting is that the short-term disinflationary signaling of bonds and the chart above are coming during yet another week featuring inflation headlines and a tough talking Fed. Once again, you can click the graphic if you’d like to read the CNBC article. This is what the mainstream is being fed about the Fed.

Meanwhile, anti-inflationary bonds continue to bounce and headlines of a different kind are seeping into the public consciousness, although the dreaded inflation is to blame (as are the rising yields that are the product of inflation) as Stagflation keeps the Fed hawking.


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This Post Has 5 Comments

  1. Fredrik (subber)

    Nat gas didn’t read the memo. Neither did my oil stocks. Is the Gold/Rinf ratio a useful indicator to us energy bugs who believe in a very tight supply constraints driven market by 7 years of underinvestment?

    1. Gary

      Much less so (IMO) than other commodities. Regardless, I think that many different items can get S/T relief if yields & inflation signals back off because the perception would be that the big bad Fed (ha ha ha) will back off.

    1. Gary

      One look at the CPI tells us that inflation is always in play as its effects have driven costs upward over many decades. It’s the system. It’s an inflationary regime until it ends, IMO, with interim dis or de flationary episodes (pit stops) to refuel the systematic inflation.

      1. Armen

        Sorry, I meant that M2 actually went down – quite a rare event

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