Gold is rallying alongside tech stocks and risk assets, defying the usual playbook, but Macquarie sees the safe-haven metal as a “collective hedge” against the risk that the current AI-driven tech boom may fall short of its high-growth, high-productivity promises.

“Gold, therefore, can be thought of as the ’hedge’ for the prospective failure of the current AI-driven tech boom to deliver on its productivity promises,” Macquarie analysts said in a recent note.

The dual rallies in gold and AI stocks can run together because there is a risk of history repeating: the AI boom ending similarly to the dot-com bust. This would likely result in inflation rather than the productivity gains investors are chasing, the analysts said. This is precisely the risk that gold has been proven to cushion.

Gold would stand out as a protection against a debt overhang that might be resolved by price spikes, rather than growth, the analyst added.

Central banks have only added fuel to the bid, amassing gold reserves well above US Treasury holdings at market value.

Private demand, meanwhile, hasn’t cooled off, evidenced by gold’s 120% surge since the end of 2022, mirroring the run-up in Nasdaq fueled by the AI hype. Macquarie flags the risk that if investment returns don’t pan out, a widespread unwind could lead central banks to ease aggressively, igniting inflation and further bolstering gold.

While the higher tech stocks go, the greater the risk of a future bust and a market pivot back to “remonetization.”

For now, however, hedgers are pairing gold exposure with bullish tech bets, but it’s gold that could prove a lifeline for those bracing for a productivity disappointment at the core of the AI story.