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Gold continues to tumble today after a brutal Friday session took the shiny yellow metal below $1600 per ounce. Over the past four months, it’s fallen more than 10 percent from its October 4 high of $1798.10.

In a note to clients, Deutsche Bank commodities analyst Xiao Fu has a few thoughts on why gold prices are falling.

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Breaking news: Gold drops below $1,600

Perhaps the biggest factor weighing on gold prices is the drop in the equity risk premium, which in turn is driven by rising yields.

The equity risk premium is the expected rate of return of stocks over that of bonds (here, specifically, it’s defined as the S&P 500 earnings yield less the yield on a 10-year Treasury bond).

The chart below shows that gold prices track the ERP pretty closely.

Deutsche Bank, Bloomberg Finance LP

As bond yields rise – and stocks rise, depressing the S&P 500 earnings yield – it’s caused the ERP to fall.

The recent rise in bond yields has been encouraged by the release of the December FOMC minutes in early January, which revealed for the first time that the Federal Reserve was considering reining in quantitative easing by the end of 2013.