The real price of Gold or relative Gold refers to Gold’s performance against other markets and asset classes. The real price of Gold can be a leading indicator for the price of Gold. Also, Gold relative to Commodities (namely Oil and Steel) is a leading indicator for profit margins for gold producers. The Gold/Oil and Gold/Steel ratios are important because Steel and Oil are input costs for miners.
The real price of Gold has begun to turn up. From top to bottom we plot: Gold/Oil, Gold/Steel, Gold/Silver and Gold/S&P. Gold has already turned up against Commodities and it may have already bottomed relative to stocks.