A QE flipside for gold's lost lustre

With US Fed stimulus measures continuing for a while, producers are unlikely to get respite from gold's price plunge soon – unless QE-inflated asset bubbles eventually burst.

Gold traded below $US1200 an ounce overnight – the lowest level in three years – on its way to its first annual loss this century and more than 37 per cent below its peak just over two years ago. Blame the Federal Reserve board.

It has been obvious through this year that there has been a very direct correlation between the market’s readings of the Fed’s intentions in relation to its quantitative easing program and the gold price, among other financial assets.

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