The expected higher rate of inflation has been met by increased investment in gold. Yet, some are not convinced that inflation is the only factor prodding gold-related exchange traded (ETFs) to new heights.

As the dollar gained last Thursday, gold gave up some of its recent gains, reports Sara Lepro for The Associated Press. The government also reported that inflation is relatively subdued, which further dampened gold prices.

Inflation still plays a large role in investor’s appetite for gold. The weakness of the U.S. dollar coupled with the Fed’s unwillingness to raise interest rates (for now) has kept gold prices high in recent weeks. (How to play precious metals).

On Wednesday, gold reached its new high of $1,072 an ounce.

Many pundits seem to be in agreement that new money being printed by the Fed will eventually cause massive inflation and gold will soar to new heights as investors hedge, comments to Peter Gorenstein for Yahoo! Finance.

Mike “Mish” Shedlock, blogger and investment advisor at SitkaPacific Capital Management, is skeptical. He argues that the dollar instead will appreciate since everyone is so pessimistic. Shedlock also believes that gold is a poor inflation hedge, pointing to the period between the 1980s and early 2000s when inflation was steady, but gold prices dropped. Still, Shedlock believes gold will be a good bet because it preserves value during a credit crisis. (Five reasons gold is rising).