Gold ETFs record first outflows since April in November
While rising gold prices appear to have inhibited some buying and prompted tactical sales over recent months, October’s rebound in reported activity signals continued interest from central banks to accumulate gold within their reserve portfolios
Photo by Bloomberg
Global gold exchange-traded funds (ETFs) recorded their first monthly outflow since April, losing $2.1-billion in November, according to industry body the World Gold Council.
Europe (-$1.9-billion) led outflows, while North America, with $79-million of inflows, was the only region to report inflows.
Total assets under management fell by 4% to $274-billion in November, but global gold ETF’s year-to-date flows have remained positive at $2.6-billion, the council points out.
Collective holdings dropped by 29 t to 3 215 t during November, shifting their year-to-date demand to negative, at -11 t.
Global gold market liquidity kept rising, supported by active trading in futures and ETFs, the council states.
Central banks reported 60 t of net purchases for November – the highest amount recorded in the year-to-date.
The Reserve Bank of India led the field, adding 27 t of gold to its reserves, followed by Turkey and Poland, with 17 t and 8 t respectively.
The National Bank of Kazakhstan recorded its first monthly net buying, of 4 t, after five consecutive months of reducing gold holdings.
Data made available by the Bank of Ghana shows that its gold reserves now amount to 28 t.
The country’s gold reserves have increased steadily since May 2023, when they stood at just under 9 t. Ghana added a further 1 t during October, the council points out.
The council highlights that central bank demand remains robust, with year-to-date (reported and unreported) buying having reach 694 t by the end of the third quarter of this year – comparable to levels seen in 2022.
While rising gold prices appear to have inhibited some buying and prompted tactical sales over recent months, October’s rebound in reported activity signals continued interest from central banks to accumulate gold within their reserve portfolios, the council avers.
It says this reaffirms the role gold plays as a strategic asset for central banks to manage risks and diversify reserves.
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