08.12.202110:46 Forex Analysis & Reviews: Influx into gold ETFs has increased

The World Gold Council announced that the gold market has seen an influx into the ETF for the first time in four months.

Last month, US inflation, which reached its highest level in 31 years, pushed investors into the gold market. However, according to the latest data from the World Gold Council, this momentum did not last long, as prices could not stay above the level of $ 1800.

In its latest report, the WGC announced that the volume of exchange-traded products in November, backed by gold, amounted to 13.6 tons. This was the first month of inflows to the gold ETF market since July.

But despite the increase in demand for ETFs last month, the WGC described the price behavior as neutral, rising by 2% over the month.

The month ended with a 2% increase in prices because inflation expectations rose to the highest level in the first half of November since 2005. In the end, the yield was leveled, as the collapse in oil prices and growing concerns about the Omicron strain of coronavirus option led to the fact that the US dollar exceeded the dynamics.

Consider the regional breakdown of ETF flows in the gold market. The report says that the assets of funds listed in North America increased by 12.1 tons last month, and funds with a listing in Europe received 5.6 tons. Meanwhile, Asian ETFs showed an outflow of 5 tons.

According to analysts, the global outflow of gold ETFs amounted to 8.8 billion US dollars (-167t) from the beginning of 2021 to the present, because large North American and European funds lost assets due to fluctuations in gold prices.

Predicting the future, the WGC said that inflation and interest rates in the US will remain the two dominant drivers for this precious metal.