In a free market, prices tend to drop. One of the points of gold backed means there is a check on arbitrary indefinite expansion of the money supply (Federal Reserve/Fractional Reserve Banking). But, healthy expansion can take place even with a fixed supply, as the per unit price increases in the face of higher demand.
A free market is the amalgam of exchanges made by two individuals/groups on a voluntary basis, grounded in the assumption that by making the exchange, both parties benefit. This can describe a transcendent national economic order, or a subset industry.
In the absence of an intervening third party (government), the supply/demand reach an equilibrium price that acts as an indicator to producers/investors which industries/products need more production. As these parties pour more investment and production into high demand/low supply sectors, the per unit price drops as the supply is increased.
Don't confuse free-market to mean ONLY an anarcho-capitalist economic order. It can just be subset markets.