Commodities & Metals

Gold-Backed Inflows Rise in Asia and Europe

In the past month, global gold-backed exchange traded fund holdings added 15 tonnes (t) to 2,484. Ultimately, Europe and Asia drove inflows as European funds have responded strongly in the past two months and North American fund flows reversed their early 2018 trend as they lost 2.3% of assets. The North American loss is likely a result of the volatile prices in the gold market, which left gold lower by 60 basis points on the month.

Volatility and weakness in the gold market were largely driven by a stronger dollar. However, USD-hedged gold was higher by 1.4% on the month

A few highlights from the World Gold Council’s monthly report:

  • North American funds lost 30t (US$1.2 billion, 2.3% of assets under management).
  • European funds saw solid net inflows in May, growing by 26t (US$1.2bn, 2.8%).
  • Total fund holdings in Asia rose by 21t (US$862mn) growing assets by 20%.
  • Funds in other regions lost 2t, or 6% of assets.

Overall, SDPR Gold Shares was the main driver of U.S. and North American outflows losing 24t (US$1 billion, 2.7%), while iShares Gold Trust also lost 2t (US$100 million).

Inflows in Europe were once again led by Xtrackers Physical Gold (23t, 74%) in Germany and Invesco Physical Gold (4t, 3.5%) in the United Kingdom.