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1. C  
   

    
 

 
 
2. When inflation goes up, gold follows suit.
Likewise, a drop in inflation would lead to
a fall in the gold price
3. This is because in times of high inflation,
gold becomes a better option for
investors
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1. L
  
2. They track the gold price in US$ per
ounce and the monthly US Consumer
Price Index, which is a gauge for inflation
3. The first chart goes from 1974 until 1980
which was a bull market for gold
4. The second chart shows the 21-year bear
market from 1980 to 2001
5. On the last chart, the current bull market
is seen, which stated in 2001

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1. F1B


2. 1974 until January 1980, gold went up
from US$ 129 (monthly averages) to US$
675 per ounce at the end of the period
3. This is an increase of 353%
4. During the same time, the consumer price
index, a measure of inflation increased by
67%
5. Here, gold strongly outpaces the inflation
development

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D F2B
D ãetween 1980 and April 2001, gold went
down from US$ 675 to US$ 260 per
ounce, which is a decrease of 67%
D In contrast, the consumer price index
increased during the same period by
around 126%

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1. F_B


2. From 2001 to February 2011, the gold
rate experienced huge gains of 527 per
cent
3. The overall inflation rate was only 25 per
cent

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1. Especially remarkable is the inflation

decrease in the middle of 2008
2. If the theory of a positive correlation
held true, the gold price would also go
down
3. ãut the opposite was the case: inflation
went down, and gold went up
4. This rather points to an inverse
correlation between gold and inflation

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1. First, the 

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commissioned a study from the research
firm Ibbotson Associates
2. According to their research, between 1978
and 2010 gold and the inflation rate have
a correlation value of 0.08
3. This is nearly no correlation (on a scale
ranging from -1 to 1, where 1 is perfect
correlation, and -1 perfect negative
correlation, and zero is the absence of a
relationship)
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1. Second, also C   comes in 2009 to

the conclusion that ´there is no obvious
relationship between the gold price and
inflationµ
2. Sometimes the development of gold
follows inflation, at other times there is
an inverse trend or just on obvious
pattern at all

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