It might be time to buy gold. The Federal Reserve is poised to cuts interest rates this year and history shows that has pushed up precious metal prices, according to Bernstein analyst Bob Brackett. “The logic is simple,” Brackett told clients in a note Wednesday. When the expected real interest rates fall, investors buy gold because owning dollars becomes less attractive, the analyst wrote. Spot gold prices were last trading at $2,045.39 an ounce and were little changed in January. The Fed on Wednesday held benchmark interest rates steady, but in a statement indicated it may not be quite ready to start cutting rates yet either. The pattern of gold rising on lower rates is supported by 50 years of history, with the precious metal rallying in seven of the nine previous rate cut cycles, according to Brackett. The two exceptions to the rule were 1974 and 1981 when the precious metal did not rally after rate cuts, largely because the 10-year Treasury yield didn’t fall, Brackett told clients. “Learning from the last 9 rate cut cycles, especially the 1974 and 1981 cycles, we conclude that rate cut cycle is positive for gold, as long as the Fed successfully brings rates down” for longer-dated Treasurys, Brackett said. “When the Fed fails to bring LT rates down, USD is likely to gain strength (and work against gold prices),” the analyst pointed out. Looking back at the 95 rate cuts since 1971, buying gold delivered weighted average returns of 2.48% in one month and up to 6.53% in a year, according to Brackett. Purchasing the precious metal ahead of a rate cut cycle is correlated with a slightly higher return of 6 basis points, or 0.06%. One major risk to Bernstein’s bullish thesis would come if the U.S. economy continues to show robust growth and low unemployment, Brackett told clients. Traders are already moderating expectations for rate cuts, though gold has held steady so far, Brackett said. Indeed, respondents to CNBC’s recent Fed survey now anticipate the central bank will cut rates fewer times this year and start the cycle later. “In general, the anticipation of more rate cuts often lead to a positive sentiment on gold and mining equities, while the expectation of fewer rate cuts tends to be negative,” Brackett said. Still, it is reasonable to expect that the U.S. economy will slow this year with real rates at the highest level since 2010, which would justify Fed cuts, according to Brackett. “Gold in the long term is generally observed to benefit from rate cuts,” the analyst said. @GC.1 3M mountain April gold futures over the past three months. — CNBC’s Michael Bloom contributed reporting.