WGC: ETF inflow streak continues through August

Precious metals ETFs have been in demand in 2024, and Asia is leading the way

October the best month on record for gold ETFs (photo credit: PR)
October the best month on record for gold ETFs
(photo credit: PR)

The trend of gold ETF inflows held for the fourth straight month, according to a report by the World Gold Council.

Physically backed gold ETFs added $2.1 billion last month.

“Western funds once again contributed to the lion’s share,” the report states. “The 3.6% rise in the gold price, paired with further inflows, lifted global AUM by 4.5% to another month-end peak of $257 billion.”

Net longs continue to rise

COMEX net longs reached 917 tonnes by the end of August, a 17% month-over-month increase and the highest month-end level since February 2020, the report states.

The move is attributed to gold’s recent performance and the likelihood of interest rates being cut by the Federal Reserve.

 Top 10 fund flows in August. (Source: WGC) (credit: PR)
Top 10 fund flows in August. (Source: WGC) (credit: PR)

In the meantime, trading volumes fell slightly, reaching $241 billion per day in August, about a 3.2% month-over-month drop. North American volume cooled with just $80 billion in trades, attributed to a 28% month-over-month decline in COMEX volumes. However, Asia picked up slack, as the Shanghai Futures Exchange volume of gold trades rose 11% month over month.

India leading the way

Asian gold ETFs reached an inflow streak of 18 months at the conclusion of August, according to the WGC report.

 Gold ETF holdings and flows by region. (Source: WGC) (credit: PR)
Gold ETF holdings and flows by region. (Source: WGC) (credit: PR)

“India once again led inflows in the region, marking the strongest month since April 2019, mainly driven by continued positive momentum from the budget announcement in July and the local gold price strength,” the report states. “Japan also saw notable inflows — for the sixth consecutive month — which might be related to amplified equity market volatility and lower Japanese government bond yields in August.”

China broke its eight-month inflow streak for the first time in August an led outflows during the month.

This article is for informational purposes only. The opinions and analysis herein are those of the author and are not financial advice. The Jerusalem Post (JPost.com) does not endorse or recommend any investments based on this information. Investors should consider their financial situation, investment goals, and risk tolerance before making any decisions. Consulting a qualified financial advisor is recommended. JPost.com is not liable for any investment losses from using this information. The information provided is for educational purposes only and should not be considered as trading or investment advice.