From Sober Look:
...During periods of inflationary pressure, inflation risks tend to drive yields and gold in the same direction (bond prices and gold move in the opposite direction.) That is why historically gold was viewed as a strong hedge for traditional assets. Here is an example covering one of the periods when inflation was a major concern: 1978 - 1979 (24 months).
The relationship looks dramatically different over the last couple of years, with two different regimes visible over the period. The link between the two asset classes prior to April 2013 was quite weak, with no consistent correlation in their movements. But after April, the correlation between rates and gold price turned negative.
What happened in April that forced a switch to the new regime?...MORE
