Market Briefing: Gold
Yardeni Research, Inc.
September 30, 2021
Dr. Edward Yardeni 516-972-7683 [email protected]
Mali Quintana 480-664-1333 [email protected]
Please visit our sites at www.yardeni.com blog.yardeni.com
thinking outside the box Table Of Contents TableTable OfOf ContentsContents
Gold Price 1 Gold Price: Nominal & Real 2 Gold vs. Dollar 3 Gold & Commodity Prices 4-5 Gold & PPI Inflation 6 Gold & CPI Inflation 7 Gold, Dollar, & Political Cycle 8 Gold Price and US Federal Deficit & Debt 9 Gold Price & Central Banks 10 Relative Gold Price 11-13 Gold Price vs TIPS Yields 14 Gold Price 15-16
September 30, 2021 / Gold Yardeni Research, Inc. www.yardeni.com Gold Price Figure 1. 2200 2200 1800 GOLD SPOT PRICE 9/30 1800 (daily, ratio scale) 1400 1400
1000 1000
600 US Dollars (1742.80) 600
yardeni.com 200 200 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
1800 1800 1400 9/30 1400
1000 1000
600 600 Euros (1503.78)
yardeni.com 200 200 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
3200 3200 2800 2800 2400 9/30 2400 2000 2000 1600 1600
1200 1200 Pounds (2349.90) 800 800
yardeni.com 400 400 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
270 270 230 230 190 12/30 190 150 150
110 110
Yen (NA) 70 70
yardeni.com 30 30 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
200-day moving average Source: Haver Analytics.
Page 1 / September 30, 2021 / Gold Yardeni Research, Inc. www.yardeni.com Gold Price: Nominal & Real Figure 2. 2270 2270 2070 GOLD PRICE* 2070 1870 1870 1670 (dollars per ounce, ratio scale) 9/30 1670 1470 1470 1270 1270 1070 1070 870 870
670 670
470 470
270 270
yardeni.com 70 70 75 77 79 81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 11 13 15 17 19 21 23
200-day moving average * Cash price. Source: Haver Analytics.
Figure 3. 2000 2000 GOLD PRICE*: NOMINAL vs. REAL
1800 Sep 1800
1600 1600
1400 1400
1200 1200
1000 Gold Price/CPI 1000 Gold Price 800 800
Aug 600 600
400 400
200 200
yardeni.com 0 0 75 77 79 81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 11 13 15 17 19 21 23
CPI = 100 on 1982-84. * Cash price. London gold bullion, PM Fix. Source: US Department of Labor, Bureau of Labor Statistics and Haver Analytics.
Page 2 / September 30, 2021 / Gold Yardeni Research, Inc. www.yardeni.com Gold vs. Dollar Figure 4. 2600 2600 GOLD SPOT PRICE: FOREIGN EXCHANGE VALUE* 2400 (trade-weighted dollars per ounce, weekly) 2400
2200 2200 9/30 2000 2000
1800 1800
1600 1600
1400 1400
1200 1200
1000 1000
800 800
600 600
400 400 yardeni.com 200 200 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 20 21 22
* Using JP Morgan trade-weighted dollar. Source: Haver Analytics and JP Morgan.
Figure 5. 2200 140 2100 GOLD PRICE & THE DOLLAR Gold Price* 2000 (weekly) (dollars per ounce) 1900 130 1800 JP Morgan Nominal 9/30 1700 Broad Effective 1600 Exchange Rate** (2010=100) 9/30 1500 120 1400 1300 1200 110 1100 1000 900 800 100 700 600 500 90 400 300 200 yardeni.com 100 80 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 20 21 22
* Cash price London gold bullion, PM Fix. ** Argentina, Australia, Brazil, Bulgaria, Canada, Chile, China, Colombia, Croatia, Czech Republic, Denmark, Ecuador, Egypt, France, Germany, Hong Kong, Hungary, Japan, India, Indonesia, Israel, Italy, Korea, Kuwait, Malaysia, Mexico, Morocco, New Zealand, Nigeria, Norway, Pakistan, Panama, Peru, Philippines, Poland, Romania, Russia Saudi Arabia, Singapore, South Africa, Spain, Sweden, Switzerland, Taiwan, Thailand, Turkey, United Kingdom, Ukraine, Uruguay, Venezuela, Vietnam, and United States. Source: Haver Analytics and JP Morgan. Page 3 / September 30, 2021 / Gold Yardeni Research, Inc. www.yardeni.com Gold & Commodity Prices Figure 6. 2200 660 2100 GOLD SPOT PRICE & INDUSTRIALS COMMODITY PRICE INDEX 9/29 2000 (daily) 620 1900 580 1800 9/30 1700 Gold Price 540 1600 (dollars per ounce) 1500 500 1400 CRB Raw Industrials 460 1300 Spot Price Index* (1967=100) 1200 420 1100 1000 380 900 340 800 700 300 600 500 260 400 220 300 200 180 100 yardeni.com 0 140 81 82 83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 20 21 22 23
* Includes copper scrap, lead scrap, steel scrap, tin, zinc, burlap, cotton, print cloth, wool tops, hides, rosin, rubber, and tallow. Source: Haver Analytics and Commodity Research Bureau.
Figure 7. 2175 2175 GOLD SPOT PRICE & INDUSTRIALS METALS PRICE INDEX 2025 (daily) 2025 1875 1875
1725 Gold Price 9/30 1725 (dollars per ounce) 1575 1575 CRB Industrial Metals 1425 Spot Price Index* 1425 (1967=100) 1275 1275 9/29 1125 1125
975 975
825 825
675 675
525 525
375 375
225 225 yardeni.com 75 75 81 82 83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 20 21 22 23
* Includes copper scrap, lead scrap, steel scrap, tin, and zinc. Source: Haver Analytics and Commodity Research Bureau.
Page 4 / September 30, 2021 / Gold Yardeni Research, Inc. www.yardeni.com Gold & Commodity Prices Figure 8. 2200 155 GOLD PRICE & BRENT CRUDE OIL PRICES (weekly) 145 2000 135 1800 9/30 125
1600 115 105 1400 95
1200 85 9/29 75 1000 65
800 Gold Price* 55 (dollars per ounce) 600 45 Brent Crude Oil Price** 35 400 (dollars per barrel) 25 yardeni.com 200 15 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 20 21 22
* Cash price. London gold bullion, PM Fix. ** Nearby futures price Source: Haver Analytics and Commodity Research Bureau.
Figure 9. 2200 640 2100 GOLD & CRB FUTURES PRICES 620 (weekly) 2000 600 580 1900 Gold Price* 560 1800 (dollars per ounce) 9/29 9/30 540 1700 520 1600 CRB Spot Commodity Price Index: 500 1500 All Commodities 480 1400 (1967=100) 460 1300 440 1200 420 400 1100 380 1000 360 900 340 800 320 700 300 600 280 500 260 240 400 220 300 200 200 180 100 160 yardeni.com 0 140 75 77 79 81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 11 13 15 17 19 21 23
* Cash price. London gold bullion, PM Fix. Source: Haver Analytics and Commodity Research Bureau.
Page 5 / September 30, 2021 / Gold Yardeni Research, Inc. www.yardeni.com Gold & PPI Inflation Figure 10. 2000 20 GOLD PRICE & PPI 1900 18 1800 Sep 1700 16 1600 1500 14 1400 1300 12 1200 Gold Price* 10 1100 (dollars per ounce) 1000 8 900 Producer Price Index (yearly percent change) 800 6 700 Aug 600 4 500 2 400
300 0 200 yardeni.com 100 -2 75 77 79 81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 11 13 15 17 19 21 23
* Cash price. London gold bullion, PM Fix. Source: Haver Analytics and US Department of Labor, Bureau of Labor Statistics.
Figure 11. 2000 18 GOLD PRICE & PPI 1900 16 1800 Sep 1700 1600 14 1500 Gold Price* 12 1400 (dollars per ounce) 1300 10 1200 Producer Price Index 1100 Ex Food & Energy (yearly percent change) 8 1000 900 6 800 Aug 700 4 600 500 2 400 300 0 200 yardeni.com 100 -2 75 77 79 81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 11 13 15 17 19 21 23
* Cash price. London gold bullion, PM Fix. Source: Haver Analytics and US Department of Labor, Bureau of Labor Statistics.
Page 6 / September 30, 2021 / Gold Yardeni Research, Inc. www.yardeni.com Gold & CPI Inflation Figure 12. 2000 18 GOLD PRICE & CPI INFLATION 1900 16 1800 Sep 1700 Gold Price* (dollars per ounce) (1775.78) 14 1600 1500 12 1400 Consumer Price Index (yearly percent change) (5.20)
1300 10 1200 1100 8 1000 900 6 Aug 800 700 4 600 2 500 400 0 300 200 -2 100 yardeni.com 0 -4 68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18 20 22 24
* Cash price. London gold bullion, PM Fix. Source: Haver Analytics and US Department of Labor, Bureau of Labor Statistics.
Figure 13. 2000 18 GOLD PRICE & CPI 1900 1800 Sep 16 1700 Gold Price* (dollars per ounce) 1600 14 1500 1400 Consumer Price Index Ex Food & Energy 12 1300 (yearly percent change)
1200 yardeni.com 1100 10 1000 900 8 800 700 6 600 500 Aug 4 400 300 200 2 100 0 0 68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18 20 22 24
* Cash price. London gold bullion, PM Fix. Source: Haver Analytics and US Department of Labor, Bureau of Labor Statistics.
Page 7 / September 30, 2021 / Gold Yardeni Research, Inc. www.yardeni.com Gold, Dollar, & Political Cycle Figure 14. 2430 2430 2130 Nixon Ford Carter Reagan Bush I Clinton Bush II Obama Trump 2130 1830 9/30 1830 1530 GOLD PRICE* 1530 1230 (dollars per ounce, ratio scale) 1230 930 930
630 630
330 330
yardeni.com 30 30 68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18 20 22 24
* Cash price, London gold bullion, PM Fix. Monthly from 1968 through 1974, then daily. Source: Haver Analytics.
Figure 15. 130 130 NOMINAL FRB BROAD TRADE-WEIGHTED DOLLAR* 120 (January 2006=100) 120 9/24 110 110
100 100
90 90
80 80
70 70
60 60
50 50
Nixon Ford Carter Reagan Bush I Clinton Bush II Obama Trump 40 40
30 30
yardeni.com 20 20 68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18 20 22 24
* Argentina, Australia, Brazil, Canada, Chile, China, Colombia, Euro Area, Hong Kong, India, Indonesia, Israel, Japan, Korea, Malaysia, Mexico, Philippines, Russia, Saudi Arabia, Singapore, Sweden, Switzerland, Taiwan, Thailand, United Kingdom, and Vietnam. Source: Federal Reserve Board. Source: Haver Analytics.
Page 8 / September 30, 2021 / Gold Yardeni Research, Inc. www.yardeni.com Gold Price and US Federal Deficit & Debt Figure 16. 4500 2000 GOLD PRICE vs. US FEDERAL DEFICIT 4000 3500 Federal Deficit 3000 1500 (12-month sum, billion dollars) Aug 2500
2000 Gold Price* 1000 1500 1000
500 500 0 -500 -1000 0 75 77 79 81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 11 13 15 17 19 21 23
80 2000 GOLD PRICE vs. US FEDERAL GOVERNMENT BORROWING Sep
60 Federal Borrowing 1500 (as a percent of nominal GDP)
40 Gold Price* 1000
20
500 0
-20 0 75 77 79 81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 11 13 15 17 19 21 23
120 2000 GOLD PRICE vs. US FEDERAL DEBT Federal Public Debt Outstanding Q2 100 (as a percent of nominal GDP) 1500 Gold Price* 80
1000
60
500 40
yardeni.com 20 0 75 77 79 81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 11 13 15 17 19 21 23
* Cash price. London gold bullion, PM Fix. Source: US Treasury Department, Board of Governors of the Federal Reserve System, and Flow of Funds.
Page 9 / September 30, 2021 / Gold Yardeni Research, Inc. www.yardeni.com Gold Price & Central Banks Figure 17. 12.0 2200 GOLD PRICE vs. US TREASURIES & AGENCIES HELD BY CENTRAL BANKS 11.5 9/29 11.0 2000 10.5 10.0 1800 9.5 9.0 Gold Price* 1600 8.5 (US dollars per ounce) 8.0 7.5 1400 7.0 US Treasuries & Agencies Held By 6.5 Fed + Foreign Central Banks 1200 6.0 (trillion dollars, nsa) 5.5 1000 5.0 4.5 800 4.0 3.5 600 3.0 2.5 2.0 400 1.5 yardeni.com 1.0 200 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
* Cash price. London gold bullion, PM Fix. Source: Federal Reserve Board and Haver Analytics.
Figure 18. 12500 2200 12000 US TREASURIES & AGENCIES HELD BY FED AND US COMMERCIAL BANKS 9/15 11500 2000 11000 10500 1800 10000 Gold Price* 9/24 (US Dollar/Troy Ounce) 9500 1600 9000 8500 Fed + 8000 US Commercial Banks 1400 (billion dollars, nsa) 7500 7000 1200 6500 6000 1000 5500 5000 800 4500 4000 600 3500 3000 2500 400 2000 yardeni.com 1500 200 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024
* Cash price. London gold bullion, PM Fix. Source: Federal Reserve Board and Haver Analytics.
Page 10 / September 30, 2021 / Gold Yardeni Research, Inc. www.yardeni.com Relative Gold Price Figure 19. 7.5 7.5 GOLD SPOT PRICE AS A RATIO OF S&P 500 7.0 7.0
6.5 6.5
6.0 6.0
5.5 5.5
5.0 5.0
4.5 4.5
4.0 4.0
3.5 3.5
3.0 3.0
2.5 2.5
2.0 2.0
1.5 1.5
1.0 1.0
.5 9/29 .5 yardeni.com .0 .0 73 75 77 79 81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 11 13 15 17 19 21 23 25
Source: Standard & Poor’s and Wall Street Journal.
Figure 20. 6.5 6.5 S&P 500 RELATIVE TO GOLD PRICE* 6.0 6.0
5.5 5.5
5.0 5.0
4.5 4.5
4.0 4.0
3.5 3.5
3.0 3.0
2.5 9/29 2.5
2.0 2.0
1.5 1.5
1.0 1.0
.5 .5 yardeni.com .0 .0 68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18 20 22 24
* Cash price. London gold bullion, PM Fix. Source: Standard & Poor’s Corporation and Wall Street Journal.
Page 11 / September 30, 2021 / Gold Yardeni Research, Inc. www.yardeni.com Relative Gold Price Figure 21. 9 9 GOLD PRICE* RELATIVE TO EXISTING HOME PRICES
8 8
7 7
6 6
5 5 Aug Gold Price/Average Existing Home Prices 4 4
3 3
2 2
yardeni.com 1 1 81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 11 13 15 17 19 21 23
* Cash price. London gold bullion, PM Fix. Source: Wall Street Journal and National Association of Realtors.
Figure 22.
***** Chart Not Available *****
Task: GOLDCRBF_BB
KEEP command attempted on missing data
09-29-2021 - 20:34:14
Page 12 / September 30, 2021 / Gold Yardeni Research, Inc. www.yardeni.com Relative Gold Price Figure 23. 2.5 2.5 GOLD CASH PRICES* RELATIVE TO PLATINUM CASH PRICES
2.0 2.0
9/30
1.5 1.5
1.0 1.0
.5 .5
yardeni.com .0 .0 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 20 21 22 23
* Cash price. London gold bullion, PM Fix. Source: Standard & Poor’s Corporation and Wall Street Journal.
Figure 24. 225 225 GOLD PRICE* RELATIVE TO SILVER CASH PRICES
200 200
175 175
150 150
125 125 7/9
100 100
75 75
yardeni.com 50 50 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 20 21 22 23
* Cash price. London gold bullion, PM Fix. Source: Standard & Poor’s Corporation and Wall Street Journal.
Page 13 / September 30, 2021 / Gold Yardeni Research, Inc. www.yardeni.com Gold Price vs TIPS Yields Figure 25. 2200 -2.0 2100 GOLD SPOT PRICE & 10-YEAR US TIPS YIELD (daily) -1.5 2000
1900 -1.0 9/24 1800 -.5 1700
1600 .0 1500 .5 1400 1300 1.0 1200 1100 1.5 1000 Gold Price 2.0 900 (dollars per ounce) (1750.00) 800 2.5 10-Year TIPS Yield 700 (percent, inverted scale) (-0.87) 3.0 600 yardeni.com 500 3.5 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
Source: Federal Reserve Board, Wall Street Journal, and Haver Analytics.
Figure 26. 2100 -3 2000 GOLD PRICE & 5-YEAR TIPS YIELD (daily) 1900 -2 1800 9/24 9/23 1700 -1 1600 1500 0 1400 1300 1 1200
1100 Gold Price* 2 1000 (dollar per ounce) 900 3 800 5-year TIPS Yield (inverted scale) 700 4 600 yardeni.com 500 5 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
* Cash price. London gold bullion, PM Fix. Source: Board of Governors of the Federal Reserve System.
Page 14 / September 30, 2021 / Gold Yardeni Research, Inc. www.yardeni.com Gold Price Figure 27. 2125 2125 1950 GOLD SPOT PRICE 1950 1775 (dollars per troy ounce, ratio scale) 9/30 1775 1600 1600 1425 1425 1250 1250
1075 1075
900 900
725 725
550 550
375 375
yardeni.com 200 200 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
200-day moving average Source: Wall Street Journal and Haver Analytics.
Figure 28. 160 2500 GOLD PRICE & FED’S MAJOR TRADE-WEIGHTED DOLLAR INDEX
Gold Price* (dollars per ounce) 140 2000 Fed’s Major Trade-Weighted Dollar Index** 9/30 (March 1973=100) 120 1500
100 1000
12/31
80 500
yardeni.com 60 0 75 77 79 81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 11 13 15 17 19 21 23
* Cash price, London gold bullion, PM Fix. ** Index is the weighted average of the foreign exchange rates of the US dollar against the Euro Area, Canada, Japan, United Kingdom, Switzerland, Australia, and Sweden. The Euro Area includes Germany, France, Italy, Netherlands, Belgium/Luxembourg, Ireland, Spain, Austria, Finland, Portugal, & Greece. Source: Federal Reserve Board, Wall Street Journal, and Haver Analytics.
Page 15 / September 30, 2021 / Gold Yardeni Research, Inc. www.yardeni.com Gold Price Figure 29. 2200 155 GOLD PRICE & BRENT CRUDE OIL PRICES (weekly) 145 2000 135 1800 9/30 125
1600 115 105 1400 95
1200 85 9/29 75 1000 65
800 Gold Price* 55 (dollars per ounce) 600 45 Brent Crude Oil Price** 35 400 (dollars per barrel) 25 yardeni.com 200 15 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 20 21 22
* Cash price. London gold bullion, PM Fix. ** Nearby futures price Source: Haver Analytics and Commodity Research Bureau.
Page 16 / September 30, 2021 / Gold Yardeni Research, Inc. www.yardeni.com Copyright (c) Yardeni Research, Inc. 2021. All rights reserved. The information contained herein has been obtained from sources believed to be reliable, but is not necessarily complete and its accuracy cannot be guaranteed. No representation or warranty, express or implied, is made as to the fairness, accuracy, completeness, or correctness of the information and opinions contained herein. The views and the other information provided are subject to change without notice. All reports and podcasts posted on www.yardeni.com, blog.yardeni.comhttp://blog.yardeni.com, and YRI’s Apps are issued without regard to the specific investment objectives, financial situation, or particular needs of any specific recipient and are not to be construed as a solicitation or an offer to buy or sell any securities or related financial instruments. Past performance is not necessarily a guide to future results. Company fundamentals and earnings may be mentioned occasionally, but should not be construed as a recommendation to buy, sell, or hold the company’s stock. Predictions, forecasts, and estimates for any and all markets should not be construed as recommendations to buy, sell, or hold any security--including mutual funds, futures contracts, and exchange traded funds, or any similar instruments.
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