Gold's Price Rally Isn't About Inflation This Time.

Gold's recent rally in price is not solely driven by inflation concerns. While gold has historically underperformed stocks over extended periods, it has also experienced periods of outperformance, such as in the 1970s and the 2000s. Gold's appeal as an investment is not only tied to inflation, but also to its role as a hedge against fear and uncertainty. It is seen as a store of value that is not contingent on societal arrangements and can be transported in emergencies. Central banks, including China, have been purchasing gold as a hedge against the dollar and potential future sanctions. UBS recommends a 5% allocation to gold in a diversified portfolio as a risk hedge. [Extracted from the article]