July saw the eighth consecutive month of this year’s influx of gold-backed ETFs, with investors adding a total of 166 metric tonnes in July, which equates to $ 9.7 billion or 4.1% of assets under management (AUM), according to the report last week.
“Global holdings hit a new all-time high of 3,785 t again and the price of gold hit a record US $ 1,976 / ounce at the end of July, leaving aggregate assets at $ 239 billion . Global net inflows of 899 t ($ 49.1 billion) to date are considerably higher than previous annual highs, and the trend of inflows continued into the first trading days of August, with the price gold having exceeded 2,000 dollars / ounce, ”the report said. Noted.
North American funds led the pack with 118 tonnes of gold added, which accounted for 75% of global net inflows in July. Funds listed in Europe added 40 tonnes and funds listed in Asia by 4.9 tonnes.
Gold-backed ETFs now accounted for around 21% of total gold demand in 2020, according to the WGC.
The lure of gold as a safe haven is pushing investor funds towards ETFs this summer and the WGC expects further price gains for the yellow metal.
“While the price of gold has reached all-time highs in nominal terms, it remains below the inflation-adjusted record, which is US $ 2,800 or 42% higher,” the board said. Short-term breaks or consolidation periods are also not excluded.
Economic uncertainty and real rates near or at historically low levels will continue to support gold over the long term.
“Demand and investment momentum seem to more than make up for the deficit caused by economic weakness. With the recent shift in demand, only 32% of demand came from jewelry, bullion and coins and technology in the second quarter of 2020, with the remainder coming from investments – like gold ETFs – and central banks, ”the report adds.
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