A sustained rally in gold and relatively muted equity performance have pushed the gold-to-Sensex ratio to its highest level in more than a decade, excluding the pandemic-driven disruption of 2020. The ratio touched 1.4 on Friday, a level last seen in early 2014 when it was close to 1.5. Advertisement

By comparison, the ratio stood at 0.97 in December 2023 and 0.89 in September 2023. Over the past 30 years, the median value of this ratio — calculated by dividing spot gold prices by the Sensex — has been around 1.04, suggesting that current levels are well above historical averages.

Traditionally, gold and equities tend to move in cycles. Periods of equity outperformance are often followed by a surge in gold, and vice versa. For instance, equities dominated between 2003 and 2007, but gold

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