Hedging inflation with gold, The future of the dollar

Banking, Finance, Markets, Shipfinance — By on October 18, 2018 at 7:39 AM

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Commentary: Hedging inflation with gold

By Aimee Bowkett in London

Gold has fallen out of favour in financial markets, hitting a 19-month low in August. However, it is seen as a good hedge against rising inflation. Since the gold standard was dropped in 1971, no country has seen average inflation below 2% and only 28 have seen it average below 5%.

While the Fed reduces its balance sheet, gold could be particularly attractive as a safe haven against equity market crashes. Importantly though, since stock prices often start to recover after a severe negative shock, gold loses its appeal in the long-run.

Read the full commentary on the website.

Podcast: In Conversation: Jeffrey Frankel, Harvard University’s Kennedy School of Government

Mark Sobel, US chairman of OMFIF, is joined by Jeffrey Frankel, James W Harpel professor of capital formation and growth at Harvard University’s Kennedy School of Government.

They discuss the dollar’s current status as international reserve currency, its potential future and the role of the International Monetary Fund.

Listen to the recording, or search for OMFIF on your smartphone’s podcast app.

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