Global gold ETF flows continue

Investing.com — Global physical-backed exchange-traded funds (ETFs) posted a fourth straight month of inflows in August, driven mainly by higher holdings in funds listed in North America and Europe, the World Council of ETFs said on Thursday Gold (WGC). as reported by Reuters.

Gold ETFs, which hold physical bullion for investors, play a vital role in the investment demand for gold. The precious metal hit a record high of $2,531.60 an ounce on Aug. 20, fueled by expectations of future U.S. interest rate cuts.

Despite this recent positive trend, gold ETFs have seen outflows for three consecutive years due to high global interest rates. The recent four-month flow of inflows only partially offset year-to-date losses, resulting in a net outflow of 44 metric tons, the report said.

In August, gold ETFs added 28.5 tonnes, equivalent to $2.1 billion, bringing their total holdings to 3,182 tonnes, according to the WGC. Rising gold prices and recent inflows pushed total assets under management to $257.3 billion in August.

The report also added that global gold trading volume fell 3.2 percent in August from the previous month, with daily trading volumes averaging $241 billion due to lower exchange-traded activity on COMEX.

However, activity in the more opaque over-the-counter (OTC) market rose 5.9% to average $158 billion.

With gold prices up 21% so far in 2024 and rising expectations of a US interest rate cut, speculators on the COMEX increased their net long positions by 17% in August to 917 tonnes – the highest level since February 2020, the report states.