The real yield continues to pressure gold
Source: www.tradingview.com
The weekly chart of the real rate (top) has moved into its bullish zone, between the upper blue and red bands. This activity comes after a hawkish delivery by Fed Chair Powell at Jackson Hole on Friday.
The real rate moved positive during the week beginning 25 April (red dashed vertical). This movement coincided with the breakdown in the precious metal (middle). The correlation coefficient between the two turned down around this time. It's now a negative relationship.
As such, the positive real rate continues to apply pressure to XAUUSD. Given the current inflationary environment, capital prefers the potential for real return over the safety of gold. This preference, especially since Jackson Hole, is because the market anticipates further hikes, which will be a headwind for gold.
Russell Shor
Senior Market Strategist
Russell Shor is a Senior Market Strategist at FXCM, having been promoted to the role in 2025 in recognition of his depth of insight and consistent delivery of high-impact market analysis. He originally joined FXCM in October 2017 as a Senior Market Specialist.
Russell holds an Honours Degree in Economics from the University of South Africa, is a certified FMVA®, and a full member of the Society of Technical Analysts (UK). With over 20 years of experience in financial markets, his work is renowned for its clarity, precision, and strategic value across asset classes.
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