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Negative 30-year Real Yield as Gold Buy Signal

June 29, 2021 • Posted in Economic Indicators, Gold

A subscriber asked for corroboration of an assertion that a negative 30-year U.S. Treasury real yield indicates a good time to buy gold. To investigate, we employ the following monthly data:

Each month, we subtract the 12-month past change in CPI (lagged one month for release delay) from the 30-year yield. When this real yield turns negative, we buy spot gold at the end of the same month and sell it the at the end of the month when the real yield turns positive. Using monthly data as specified through May 2021, we find that: (more…)

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