Gold ETFs Diverge From Spot Prices: Record Ninth Consecutive Month Of Outflows
Portfolio Pulse from Stjepan Kalinic
Global physically backed gold ETFs have experienced outflows for nine consecutive months, totaling $5.7 billion year-to-date, despite gold prices reaching all-time highs. The outflows are primarily from North America, with factors such as a strong labor market, higher inflation, and a potential Federal Reserve rate cut contributing to the trend. However, gold prices continue to rise due to speculative betting and physical demand, particularly from China. Central bank demand remains strong, supporting gold prices. Gold ETFs mentioned include SPDR Gold Trust (GLD), iShares Gold Trust (IAU), Abrdn Physical Gold Shares ETF (SGOL), and VanEck Gold Miners (GDX).
March 08, 2024 | 8:31 pm
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NEUTRAL IMPACT
VanEck Gold Miners (GDX) is highlighted amidst a backdrop of gold ETF outflows and rising gold prices.
GDX, focusing on gold miner equities, may have a different impact compared to physically backed gold ETFs. The rising gold prices could benefit gold mining companies, offsetting the negative sentiment from ETF outflows, leading to a neutral short-term impact.
CONFIDENCE 80
IMPORTANCE 70
RELEVANCE 80
NEUTRAL IMPACT
SPDR Gold Trust (GLD) is experiencing outflows amid rising gold prices, influenced by global economic factors and central bank demand.
GLD's outflows are significant given the context of rising gold prices, suggesting a complex investor sentiment. However, strong central bank demand for gold could provide underlying support, making the short-term impact neutral.
CONFIDENCE 85
IMPORTANCE 80
RELEVANCE 90
NEUTRAL IMPACT
iShares Gold Trust (IAU) faces outflows despite a bullish market for gold, driven by speculative betting and physical demand.
IAU's outflows occur amidst a generally positive market for gold, indicating mixed investor sentiment. The continued demand for gold, especially from central banks, suggests a neutral short-term impact.
CONFIDENCE 85
IMPORTANCE 80
RELEVANCE 90
NEUTRAL IMPACT
Abrdn Physical Gold Shares ETF (SGOL) records outflows, contrasting with the overall rising demand for gold.
SGOL's situation mirrors that of other gold ETFs, with outflows despite favorable conditions for gold. The strong demand for gold, partly from central banks, tempers the potential negative impact, leading to a neutral outlook.
CONFIDENCE 85
IMPORTANCE 80
RELEVANCE 90