Key facts
- Global gold-backed ETFs attracted $3 billion in July, ending a two-month outflow streak.
- Gold holdings increased by 23 metric tons to 4,068 tons in July.
- Spot gold prices were around $4,400 per troy ounce early Wednesday.
- Europe accounted for the largest portion of July's ETF inflows with $2 billion.
- North America showed tentative signs of recovery with $71 million in inflows.
- Asian funds contributed $616 million in gold ETF inflows during July.
Gold demand is showing signs of broadening as investors return to the market, potentially fueling a rally in the precious metal. Global gold-backed exchange-traded funds (ETFs) attracted $3 billion in July, marking a reversal after two consecutive months of outflows, according to the World Gold Council. Total holdings rose by 23 metric tons to 4,068 tons.
While the overall picture is positive, the recovery has been uneven. Europe led the charge in July, with its gold ETFs drawing $2 billion, representing the second-strongest monthly inflow this year. North America, however, saw a more modest recovery, with inflows of just $71 million, leaving the region as the only one to post net ETF outflows for the month. Asian funds, meanwhile, purchased $616 million of gold ETFs in July.
This renewed investor interest follows a period of volatility earlier in the year. After reaching record highs in January, gold prices declined as rising bond yields and a stronger dollar dampened investment demand. Despite this selloff, central banks and Asian investors continued to accumulate gold, even as Western asset managers reduced their holdings. A stronger return from Western investors, particularly from North America, could provide an additional significant pillar of support for the gold market.