Real interest rates are a key driver for gold prices. As real rates are starting to roll over (see chart on top), gold seems to be catching a bid. Furthermore, looking at growth slowing in the second part of the year and in 2022, participants are perhaps getting more constructive on the possibility of real rates declining further and gold prices heading higher. Another reason more astute investors may want to be constructive on gold, is the possibility of BTC stumbling. Flow data clearly shows that a competition for investment has developed between the two assets (see chart on the bottom). Should regulatory changes stifle BTC's otherwise unstoppable ascent, gold may end up benefiting. Plan "B" to "Plan B" if you wish, against currency debasement.
