Gold vs. 10Y Treasury
Gold price and 10-Year Treasury yield · Quotes delayed up to 5 minutesGold plotted against the nominal yield on the 10-year U.S. Treasury bond. The relationship is generally inverse but considerably noisier than the gold-versus-real-rates chart, because nominal yields conflate the inflation-expectations channel and the real-rate channel. Rising nominal yields can reflect either rising inflation expectations (which is bullish gold) or rising real rates (which is bearish gold), and the same chart pattern can mean opposite things at different times.
Analyst's Note
Decomposing the 10-year yield into its real-rate and inflation-expectation components is the analytical move that separates serious macro investors from headline readers. Periods when nominal yields rise primarily through the real-rate channel (such as 2022–2023) are unambiguously bearish for gold; periods when nominal yields rise primarily through the inflation-expectation channel (such as parts of 2021) are bullish. The chart’s analytical value increases dramatically when read alongside the TIPS yield chart to isolate the real component. For the macro investor, the relevant signal is not the direction of nominal yields but the composition of the move.
Gold plotted against the nominal yield on the 10-year U.S. Treasury bond. The relationship is generally inverse but considerably noisier than the gold-versus-real-rates chart, because nominal yields conflate the inflation-expectations channel and the real-rate channel. Rising nominal yields can reflect either rising inflation expectations (which is bullish gold) or rising real rates (which is bearish gold), and the same chart pattern can mean opposite things at different times.
Analyst's Note
Decomposing the 10-year yield into its real-rate and inflation-expectation components is the analytical move that separates serious macro investors from headline readers. Periods when nominal yields rise primarily through the real-rate channel (such as 2022–2023) are unambiguously bearish for gold; periods when nominal yields rise primarily through the inflation-expectation channel (such as parts of 2021) are bullish. The chart’s analytical value increases dramatically when read alongside the TIPS yield chart to isolate the real component. For the macro investor, the relevant signal is not the direction of nominal yields but the composition of the move.
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