The correlation between gold prices and US nominal interest rates recently dropped to near record lows, which prompted some financial analysts and media sources to predict that further Fed interest hikes will inevitably lead to lower gold prices. However, proper analysis shows that gold prices move with real-interest rates, not nominal rates. And while nominal interest rates are likely to rise further, real-interest rates are not, because inflation expectations are moving higher as well. In fact, we believe that even if the economy allows the Fed to raise rates several percent higher, real-rates have likely peaked and thus gold prices troughed. Being already in the second longest economic expansion in US history, odds are that the economy will begin to slow long before the FED has raised rates to its 3% forecast, which means that the ensuing monetary easing will push real-interest rates into negative territory and gold prices higher again.