Decline in real yields yet to do much for gold

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The US real 10-year yield has fallen by 10 bp since Friday has not done a whole lot for gold prices, which fell by 0.4% today. The relationship between real yields and gold has broken apart since June, which some people blame for concerns that gold will eventually suffer as yields start rising again. Perhaps this is a good buying opportunity though, with Palantir recently buying gold as a hedge against the apparent rising risk of black swan events.


China’s official services PMI slumped to 47.5 in August, much weaker than the 52.0 reading expected and implying that output is falling. The manufacturing PMI isn’t doing much better.

The eurozone ESI fell in August and seems to signal that growth has peaked.

There has been an even sharper decline in the Swiss KOF survey.

The early German data showed inflation rose, we have to wait for the final release to see how much was driven by core inflation.

UK house price inflation according to Nationwide fell to 10.5% in July, but realtors’ expectations point to it remaining strong.


In contrast to gold, palladium has been heating up again.

Inflation expectations in Europe have been catching up with those in Europe this year, though the gap remains much wider than before Covid hit.

Most stock markets have been losing ground to the S&P 500 as US tech stocks outperform.

The cyclical AUD is up by between 0.9% and 1.6% against the USD, CHF and JPY in the past week, a sign that concerns about global growth are already fading, or just a brief respite?

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