However, gold is headed for a fourth consecutive monthly decrease and is currently around a quarter below the record highs it achieved in January 2026, while US inflation is at its highest point in three years. For now, the metal that is supposed to shield you from inflation is having the opposite effect.
What’s going on? The response dispels a significant myth about gold and explains why it isn’t necessarily the inflation hedge that many people think it is. The regime that markets are currently valuing is exactly that. Earnings per share at S&P 500 businesses increased by 25% in the first quarter of 2026 compared to the same period last year, and analysts predict that annual earnings growth will remain in double digits until the last quarter of 2027.
At the same time, the residual impact of tariffs and the oil shock associated with the dispute with Iran are driving up prices. In response, central banks are maintaining strict policy. The focus has switched to the Federal Reserve under its new head, Kevin Warsh, after the European Central Bank boosted interest rates in June.
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