Gold ETFs Inflows Continue In August, Says World Gold Council

Core Insights - Gold prices have surged to record highs due to geopolitical tensions, particularly the Hamas-Israel war, alongside a weakening US dollar and anticipated rate cuts from the Federal Reserve [2][4]. Gold ETF Inflows - Global gold-backed ETFs experienced their third consecutive month of inflows, with North American and European funds leading the way, while Asia saw mild outflows [3][6]. - In August, gold funds added 53 tonnes, bringing total holdings to 3,692 tonnes, the highest since July 2022 and just 6% below the all-time high of 3,929 tonnes reached in November 2020 [3][4]. Monetary Value of Inflows - The inflows in August totaled $5.5 billion, raising assets under management (AUM) to a record high of $407.3 billion, with year-to-date ETF inflows reaching $47 billion, the second-strongest on record after 2020 [4][8]. Regional Performance - North America recorded inflows of 37 tonnes worth approximately $4.1 billion, attributed to trade risks and lower rate expectations [5][6]. - European funds saw their fourth consecutive inflow, adding $1.9 billion or 37 tonnes, with AUMs reaching $154.2 billion [8][9]. - In Asia, gold-backed ETFs experienced outflows of five tonnes or $495.3 million, leading to a drop in physical holdings to 317 tonnes, although AUMs improved due to rising metal prices [9][10]. Demand Trends - There is a notable increase in demand for low-cost bullion funds, indicating a strategic shift among investors towards safe-haven assets amid elevated risks [7][8]. - The UK, Switzerland, and Germany were highlighted as key contributors to European inflows, with Swiss demand spurred by a significant trade tariff imposed by the US [9].