Core Viewpoint - The market is experiencing a rotation from technology stocks to defensive sectors, and there is potential for a shift from debt securities to precious metals, particularly gold, due to anticipated interest rate cuts by the Federal Reserve [1][2][3]. Market Reactions - Following Federal Reserve Chair Jerome Powell's speech, the S&P 500 rose by 1.52%, nearing its all-time high, while gold prices are expected to rise as investors move away from fixed income assets [2][3]. Gold Market Dynamics - Gold has been trading between $3,500 and $3,180 since reaching a record high in April, with expectations of a bullish trend as the Federal Reserve revises its monetary policy [4][5]. - The U.S. dollar has weakened by 10.69% from its year-to-date high of $109.98 to $98.22, which historically correlates with rising gold prices [5][6]. Geopolitical Factors - Ongoing geopolitical tensions, including stalled peace talks between the U.S. and Russia regarding Ukraine and military actions in Gaza, are expected to increase demand for safe-haven assets like gold [6]. Price Forecasts - UBS Group has raised its gold price target to $3,600, citing macroeconomic risks and strong investment demand for gold ETFs and central banks [7]. Gold-Backed ETFs Overview - **SPDR Gold Trust (GLD)**: The largest gold ETF with $102.72 billion in assets under management (AUM), has gained nearly 597% since inception [9][10]. - **iShares Gold Trust (IAU)**: Smaller than GLD with $48.41 billion in AUM, has outperformed GLD with a gain of over 648% since inception [13][14]. - **SPDR Gold MiniShares Trust (GLDM)**: Newer ETF with $16.3 billion in AUM, has gained nearly 168% since launch, offering the lowest expense ratio at 0.01% [15][16].

Core Viewpoint - Gold is experiencing a resurgence in momentum due to fears of a U.S. economic slowdown, weak labor data, and expectations of Federal Reserve rate cuts, leading to a rise of over 3% in gold prices over four days [1][5]. Economic Data - The U.S. economy added only 73,000 jobs in July, significantly below the expected 104,000, with prior months' job gains revised down by 258,000, raising recession fears [3]. - The services sector index fell to 50.1 in July from 50.8 in June, indicating a near standstill in business activity due to weak demand and rising costs [4]. Federal Reserve Rate Cuts - The weak economic data has increased the likelihood of the Federal Reserve lowering interest rates in September, with a 92% probability indicated by market tools [5]. - Lower interest rates enhance the attractiveness of gold as a non-yielding asset compared to fixed-income investments [5]. Tariffs and Safe-Haven Buying - The Trump administration's recent tariff hikes, ranging from 15% to 40% on various countries, have spurred safe-haven buying of gold [6]. - The inflationary pressures from these tariffs are expected to bolster gold's status as a hedge against rising prices [7]. Currency and Central Bank Activity - A weaker U.S. dollar and increased central bank purchases are contributing to the rise in gold prices, with 95% of central banks expecting to increase their gold reserves in the next year [8]. Gold Price Forecasts - Citigroup has raised its 3-month gold price forecast to $3,500 per ounce from $3,300, citing economic deterioration, rising inflation, and changing tariffs [9]. ETFs Performance - Gold ETFs such as SPDR Gold Trust ETF (GLD), iShares Gold Trust (IAU), and others are expected to perform well due to rising gold prices [2][10]. - SPDR Gold Trust ETF has an AUM of $103 billion and trades about 9 million shares daily, while iShares Gold Trust has an AUM of $33 billion with 6 million shares traded daily [11][12]. - Other notable ETFs include SPDR Gold MiniShares Trust (AUM: $16.2 billion), abrdn Physical Gold Shares ETF (AUM: $5 billion), and iShares Gold Trust Micro (AUM: $3.3 billion) [13][14][15]. Conclusion - Given the prevailing economic uncertainty and potential Fed rate cuts, interest in gold ETFs is likely to remain strong in the upcoming months [16].