In summary, it correlates positively with inflation but can’t be adopted due to its deflationary bias. Direct quote:
There is not much in the actual report to back up this assertion and Chatham House points to a paper on its website by John Gault (an in-joke for Ayn Rand fans?) which shows a variety of charts linking gold to various measures. At first sight, gold’s role doesn’t seem that bad; the correlation with the consumer price index (p13) is 0.749 and with commodities generally (p7) 0.862. There have been occasions when a rising gold price has given a useful signal, the panel says, but the lags are variable in length. It seems to me that gold’s historic role suggests it’s worth researching this subject rather more deeply; the recent Marsh, Dimson and Staunton report found, for example that gold was the only
asset that had a positive correlation with inflation.