“But what it also suggests is the potential upside in gold compared to how broad commodities have performed during the recent reflationary period. In the previous two periods, gold outperformed broad commodities. However, in the current environment, gold is down 10% compared to commodities, which are up substantially. Gold lagged other commodities beginning in May 2020, and has continued through the first half of 2021, but this is not unusual in commodity-led reflationary periods historically, as we addressed in our recent publication, Gold, commodities and reflation. Historically, gold lags initially, but catches up to most major commodity groups by the second and third years of a reflationary period.”
USAGOLD note: A point similar to the one we’ve made in the recent past. Historically, gold leads, lags then leads again …… The chart below on gold’s longer term performance compared to other commodities is worth a moment of reflection. The message here is “Don’t forget gold when considering an investment in the commodities matrix.” If you do, you are overlooking its best and most consistent performer.
Chart courtesy of the World Gold Council • • • Click to enlarge