Gold ETF Holdings Soar to New Record Amidst Global Market Uncertainty
The World Gold Council reported that globally held gold in physically backed ETFs reached a record high of 4,189 tonnes in August. This milestone was driven by a massive influx of $18 billion into these funds, making it the second-largest monthly inflow on record. The significant increase pushed total assets under management to a new peak of $615 billion, with holdings rising by 121 tonnes.
The surge in gold ETF demand was mainly driven by North American and European funds, which together attracted $15.6 billion in August. This marked their strongest month on record, as investors flocked back into the market amidst concerns over U.S. debt and Treasury-market stress. The gold price also saw a 13% monthly rise, its strongest month since January.
China's central bank added another 20.2 tonnes of gold to its reserves in August, marking its largest monthly purchase since October 2023. This brings China's official gold holdings to 2,387 tonnes and marks the 22nd consecutive month of growth. The People's Bank of China's buying spree is notable, as it suggests that institutional investors are increasingly driving demand for gold within China.