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Market Briefing:Gold
Yardeni Research, Inc.
September 26, 2017
Dr. Edward Yardeni516-972-7683
Mali Quintana480-664-1333
Please visit our sites atwww.yardeni.comblog.yardeni.com
thinking outside the box
Table Of Contents Table Of ContentsTable Of Contents
September 26, 2017 / Market Briefing: Gold www.yardeni.com
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Gold Price 1Gold Price: Nominal & Real 2Gold vs. Dollar 3Gold & Commodity Prices 4-5Gold & PPI Inflation 6Gold & CPI Inflation 7Gold, Dollar, & Political Cycle 8Gold Price and US Federal Deficit & Debt 9Gold Price & Central Banks 10Relative Gold Price 11-13Gold Price vs TIPS Yields 14Gold Price 15
Figure 1.
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GOLD PRICE* IN DOLLARS(daily, ratio scale)
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GOLD PRICE* IN EUROS(daily, ratio scale)
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GOLD PRICE* IN POUNDS(daily, ratio scale)
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2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 201920
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200-day moving average* Cash price. London gold bullion, PM Fix.Source: Haver Analytics.
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Gold Price
Page 1 / September 26, 2017 / Market Briefing: Gold www.yardeni.com
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75 77 79 81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 11 13 15 17 19 2170
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GOLD PRICE*(dollars per ounce, ratio scale)
Source: Haver Analytics.
200-day moving average* Cash price. London gold bullion, PM Fix.
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Figure 2.
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GOLD PRICE*: NOMINAL vs. REAL
Gold Price/CPI
Gold Price
Source: US Department of Labor, Bureau of Labor Statistics and Haver Analytics.* Cash price. London gold bullion, PM Fix.
CPI = 100 on 1982-84.
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Figure 3.
Gold Price: Nominal & Real
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94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18200
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FOREIGN EXCHANGE VALUE GOLD PRICE*(trade-weighted dollars per ounce, weekly)
* Gold spot price times JP Morgan trade-weighted dollar.Source: Haver Analytics and JP Morgan.
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Figure 4.
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 1980
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GOLD PRICE & THE DOLLAR(weekly)
JP Morgan NominalBroad EffectiveExchange Rate**(2010=100)
Gold Price*(dollars per ounce)
Source: Haver Analytics and JP Morgan.
* 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.
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Figure 5.
Gold vs. Dollar
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75 77 79 81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 11 13 15 17 19 21140
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GOLD PRICE & INDUSTRIALS COMMODITY PRICE INDEX
Gold Price*(dollars per ounce)
CRB Raw IndustrialsSpot Price Index**(1967=100)
Source: Haver Analytics and Commodity Research Bureau.
* Cash price London gold bullion, PM Fix.** Includes copper scrap, lead scrap, steel scrap, tin, zinc, burlap, cotton, print cloth, wool tops, hides, rosin, rubber, and tallow.
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Figure 6.
75 77 79 81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 11 13 15 17 19 2175
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GOLD & INDUSTRIAL METALS PRICES(weekly)
Gold Price*(dollars per ounce)
CRB Industrial MetalsSpot Price Index**(1967=100)
* Cash price. London gold bullion, PM Fix.** Includes copper scrap, lead scrap, steel scrap, tin, and zinc.
Source: Haver Analytics and Commodity Research Bureau.
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Figure 7.
Gold & Commodity Prices
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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 19 205
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9/26
GOLD PRICE & LIGHT CRUDE OIL PRICES(weekly)
CRB Futures: Light Crude Oil(dollars per barrel)
Gold Price*(dollars per ounce)
Source: Haver Analytics and Commodity Research Bureau.* Cash price. London gold bullion, PM Fix.
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Figure 8.
75 77 79 81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 11 13 15 17 19 21140
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GOLD & CRB FUTURES PRICES(weekly)
Gold Price*(dollars per ounce)
CRB Futures Price Index(1967=100)
Source: Haver Analytics and Commodity Research Bureau.* Cash price. London gold bullion, PM Fix.
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Figure 9.
Gold & Commodity Prices
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75 77 79 81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 11 13 15 17 19 21-2
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Aug
May
GOLD PRICE & PPI
Gold Price*(dollars per ounce)
Producer Price Index(yearly percent change)
Source: Haver Analytics and US Department of Labor, Bureau of Labor Statistics.* Cash price. London gold bullion, PM Fix.
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Figure 10.
75 77 79 81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 11 13 15 17 19 21-2
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GOLD PRICE & PPI
Gold Price*(dollars per ounce)
Producer Price IndexEx Food & Energy(yearly percent change)
Source: Haver Analytics and US Department of Labor, Bureau of Labor Statistics.* Cash price. London gold bullion, PM Fix.
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Figure 11.
Gold & PPI Inflation
Page 6 / September 26, 2017 / Market Briefing: Gold www.yardeni.com
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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 22-4
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GOLD PRICE & CPI INFLATION
Gold Price*(dollars per ounce) (1281.18)
Consumer Price Index(yearly percent change) (1.93)
Source: Haver Analytics and US Department of Labor, Bureau of Labor Statistics.* Cash price. London gold bullion, PM Fix.
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Figure 12.
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 20 220
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GOLD PRICE & CPI
Gold Price*(dollars per ounce)
Consumer Price IndexEx Food & Energy(yearly percent change)
Source: Haver Analytics and US Department of Labor, Bureau of Labor Statistics.* Cash price. London gold bullion, PM Fix.
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i.com
Figure 13.
Gold & CPI Inflation
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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 2030
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1530183021302430
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1530183021302430
Nixon Ford Carter Reagan Bush I Clinton Bush II Obama
GOLD PRICE*(dollars per ounce, ratio scale) 9/26
Source: Haver Analytics.* Cash price, London gold bullion, PM Fix. Monthly from 1968 through 1974, then daily.
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Figure 14.
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 2060
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160Nixon Ford Carter Reagan Bush I Clinton Bush II Obama
TRADE-WEIGHTED DOLLAR(weekly)
9/22
Source: Haver Analytics.
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Figure 15.
Gold, Dollar, & Political Cycle
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Figure 16.
75 77 79 81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 11 13 15 17 19 210
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GOLD PRICE vs. US FEDERAL DEFICIT
Federal Deficit(12-month sum, billion dollars)
Gold Price*
75 77 79 81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 11 13 15 17 19 210
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GOLD PRICE vs. US FEDERAL GOVERNMENT BORROWING
Federal Borrowing(as a percent of nominal GDP)
Gold Price*
75 77 79 81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 11 13 15 17 19 210
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Q2GOLD PRICE vs. US FEDERAL DEBT
Federal Public Debt Outstanding(as a percent of nominal GDP)
Gold Price*
* Cash price. London gold bullion, PM Fix.Source: US Treasury Department, Board of Governors of the Federal Reserve System, and Flow of Funds.
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Gold Price and US Federal Deficit & Debt
Page 9 / September 26, 2017 / Market Briefing: Gold www.yardeni.com
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2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018200
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1.0
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GOLD PRICE vs. US TREASURIES & AGENCIES HELD BY CENTRAL BANKS
US Treasuries & Agencies Held ByFed + Foreign Central Banks(trillion dollars, nsa)
Gold Price*(US dollars per ounce)
Source: Federal Reserve Board and Haver Analytics.* Cash price. London gold bullion, PM Fix.
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Figure 17.
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018200
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US TREASURIES & AGENCIES HELD BY FED AND US COMMERCIAL BANKS
Fed +US Commercial Banks(billion dollars, nsa)
Gold Price*(US Dollar/Troy Ounce)
Source: Federal Reserve Board and Haver Analytics.* Cash price. London gold bullion, PM Fix.
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Figure 18.
Gold Price & Central Banks
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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 22.0
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GOLD PRICE* RELATIVE TO S&P 500
Source: Standard & Poor’s Corporation and Wall Street Journal.* Cash price. London gold bullion, PM Fix.
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Figure 19.
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 22.0
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S&P 500 RELATIVE TO GOLD PRICE*
Source: Standard & Poor’s Corporation and Wall Street Journal.* Cash price. London gold bullion, PM Fix.
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Figure 20.
Relative Gold Price
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81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 11 13 15 17 19 211
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GOLD PRICE* RELATIVE TO EXISTING HOME PRICES
Gold Price/Average Existing Home Prices
Source: Wall Street Journal and National Association of Realtors.* Cash price. London gold bullion, PM Fix.
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Figure 21.
1981 1985 1989 1993 1997 2001 2005 2009 2013 2017 2021.6
1.0
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Relative to CRB Futures Price Index
1981 1985 1989 1993 1997 2001 2005 2009 2013 2017 2021.6
1.4
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GOLD PRICE* RELATIVE TO CRB PRICE INDEXES
Relative to CRB Raw IndustrialsSpot Price Index
Source: Commodity Research Bureau and Wall Street Journal.* Cash price. London gold bullion, PM Fix.
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Figure 22.
Relative Gold Price
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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 19.4
.6
.8
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.4
.6
.8
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1.2
1.4 9/22GOLD CASH PRICES* RELATIVE TO PLATINUM CASH PRICES
Source: Standard & Poor’s Corporation and Wall Street Journal.* Cash price. London gold bullion, PM Fix.
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Figure 23.
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 1950
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GOLD PRICE* RELATIVE TO SILVER CASH PRICES
Source: Standard & Poor’s Corporation and Wall Street Journal.* Cash price. London gold bullion, PM Fix.
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Figure 24.
Relative Gold Price
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2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 20183.5
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9/26
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GOLD PRICE & 10-YEAR TIPS YIELD(daily)
10-Year TIPS Yield(percent, inverted scale) (0.38)
Gold Price*(dollars per ounce) (1300.05)
Source: Federal Reserve Board, Wall Street Journal, and Haver Analytics.* Cash price. London gold bullion, PM Fix.
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Figure 25.
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 20185
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GOLD PRICE & 5-YEAR TIPS YIELD
5-year TIPS Yield(inverted scale)
Gold Price*(dollar per ounce)
Source: Board of Governors of the Federal Reserve System.* Cash price. London gold bullion, PM Fix.
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Figure 26.
Gold Price vs TIPS Yields
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2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018225
400
575
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925
1100
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1450
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1800
1975
225
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1100
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1450
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1975
D A
9/26
GOLD CASH PRICE(dollars per troy ounce)
Price (1300.05)
200-day moving averageD = On July 26, 2012, ECB President Mario Draghi pledged to do "whatever it takes" to defend the euro.A = On April 4, 2013, Bank of Japan implemented "Abenomics" monetary policy.Source: Wall Street Journal and Haver Analytics.
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Figure 27.
75 77 79 81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 11 13 15 17 19 210
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GOLD PRICE & FED’S MAJOR TRADE-WEIGHTED DOLLAR INDEX
Fed’s Major Trade-WeightedDollar Index**(March 1973=100)
Gold Price*(dollars per ounce)
* 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.
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Figure 28.
Gold Price
Page 15 / September 26, 2017 / Market Briefing: Gold www.yardeni.com
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