Mining Journal – Gold ETFs hit new record holding levels

February 6, 2020 – Global gold-backed exchange-traded funds (ETFs) and similar products saw net inflows of US$3.1 billion during January, boosting holdings to a new high of 2,947 tonnes, the World Gold Council said on Thursday.

Geopolitical tensions and market uncertainty combined with the coronavirus outbreak led to a 5% increase in the gold price in January to seven-year highs of US$1,584/oz and continues to make all-time highs in many global currencies, while assets under management (AUM) grew 8% in US dollar terms during the month.

Gold represented one of the best performing broader asset classes in January (plus 4.6%), and it outpaced global equity markets and commodities.

Global gold-backed ETFs saw net inflows during January that boosted holdings to all-time highs

European funds led regional inflows, adding 33t or $1.7 billion, originating mainly from the UK (21t, $1.1 billion) ahead of Brexit. North American funds added 2% to assets (29t, $1.4 billion), as coronavirus uncertainty drove inflows into safe havens.

Asian funds finished the month relatively flat, losing 1.2t ($57 million), while other regions had marginal inflows of 700kg ($41 million).

The WGC said global gold-backed ETFs assets under management was less than 2% away from the all-time highs of 2012, when the price of gold was 11% higher.

Low-cost gold-backed ETFs in the US have seen positive flows for 19 of the past 20 months and have increased their collective holdings by 220%.

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