Gold-backed exchange-traded funds (ETFs) recorded further net inflows in September, according to the World Gold Council (WGC).
This fresh uplift was thanks to accelerating bullion demand in North America, and meant that funds have enjoyed five straight months of net inflows.
Global ETFs added 18 tonnes of the expensive metal last month, the WGC said, taking total holdings to 3,200 tonnes.
Cumulative inflows were worth $1.4 billion, the council said. This — combined with a surging gold price — propelled total assets under administration (AUMs) to $271 billion, a fresh all-time high.
Gold continues to surge as concerns over military action in the Middle East grow and investors prepare for interest rate cuts. The precious metal rose to new record peaks around $2,685 per ounce on September 26.
North America And Asia Inflows Continue
In North America, ETFs recorded their third successive net monthly inflow. Total holdings rose by 16 tonnes month on month, to 1,624 tonnes.
Fresh inflows were worth around $1.4 billion, which in turn lifted regional AUMs to $137 billion.
The WGC said that “lower opportunity costs, related to interest rates and the dollar, boosted investor interest in gold ETFs.” It noted that “the US Fed surprised investors with a cut of 50 basis points at their September gathering, pushing Treasury yields and the dollar down during the month.”
Asia-located funds also enjoyed another monthly net inflow in September to take the streak to 20 months.
ETFs added two tonnes of material, nudging aggregate holdings to 186 tonnes. AUMs rose to $16 billion, a $175 million month-on-month increase.
The WGC said that “India again saw strong inflows,” helped in part by strong gold price momentum and elevated geopolitical concerns.
… But Europe Sees Outflows
However, ETFs in Europe recorded net outflows last month, the council noted. This was due predominantly to liquidation in the UK as hopes of Bank of England interest cuts receded.
The WGC commented that “compared to the US Fed’s easing efforts, the Bank of England (BoE) was more reserved, leaving rates unchanged at 5% at their September meeting, citing the upside risk of inflation from elevated wage growth.”
European funds lost two tonnes of material, which were worth a total of $245 million. As a consequence, total holdings and AUMs dropped to 1,325 tonnes and $112 billion respectively.