Global gold-backed ETFs added 61.3t (USD3.4 billion, 1.7 per cent AUM) in May, reversing three straight months of net outflows according to new data released today by the World Gold Council.
Global AUM now stands at 3,628t (USD222 billion), only 9 per cent shy of the August 2020 high of USD240 trillion and 7 per cent short of the October 2020 tonnage high of 3,908t.
The World Gold Council believes that these inflows were likely a function of investment demand increasing with the price strength of gold (+7.5 per cent), along with renewed inflation concerns in the market, a weaker dollar and lower real yields. Gold is now effectively flat on the year, rallying 13 per cent in the last two months.
Larger European funds in the UK and Germany were one of the primary drivers of inflows adding 31.2t (USD1.6 billion, 1.9 per cent) in May.
Similarly North American funds drove inflows, increasing by 34.5t (USD2.1 billion, 2.0 per cent). This was mainly driven by the largest funds supported by low-cost gold ETFs which also experienced net inflows.
Asian-listed funds had outflows for a second straight month (-USD210 million, -2.7 per cent) coming almost entirely from China, which had strong local stock market strength.
Adam Perlaky, Senior Analyst, at World Gold Council, says: “May broke the three-month stronghold of ETF outflows, reaching an AUM modest of 2020 highs, with strong activity from the US, UK, and Germany. As the end of Q2 approaches, we continue to monitor tailwinds driving gold performance in the short term as seen in Q1.
“Gold remains a promising asset for investors as market behaviour continues to be controlled by inflationary pressures coupled with the US dollar diluting in strength and lower real yields, further seen by the increase in gold price.”