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Gold ETFs bounce back

FILE PHOTO: REUTERSPremium
FILE PHOTO: REUTERS

The global assets under management (AUM) of gold ETFs stand at 3,628 tonnes ($222 billion). The AUM is now only 9% shy of the August 2020 high of $240 billion and 7% shy of the October 2020 tonnage high of 3,908 tonnes, as per the report

Global gold exchange-traded funds (ETFs) witnessed an inflow of $3.4 billion after three months as gold prices went up by 7% in May, as per a report from the World Gold Council.

The global assets under management (AUM) of gold ETFs stand at 3,628 tonnes ($222 billion). The AUM is now only 9% shy of the August 2020 high of $240 billion and 7% shy of the October 2020 tonnage high of 3,908 tonnes, as per the report.

This is a result of strengthening of gold prices, which have remained subdued this year as the year-till-date return of the yellow metal is almost flat due to inflation concerns, weaker US dollar and low real yields.

Larger funds in the US, UK and Germany were once again the primary driver of flows, flipping to net inflows. North American funds added 34.5 tonnes ($2.1 billion, 2% change), while European funds saw inflows of 31.2 tonnes ($1.6 billion, 1.9%). Funds in ‘Other’ regions lost 1.9% of assets (-1 tonne, $69 million). Asian-listed funds had outflows for a second straight month ($210 million, -2.7%).

As far as India is concerned, the consumption demand again saw a decline as the country was hit by the second wave of covid. Meanwhile, global central banks’ purchases of gold have again gone up.

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