Wednesday, December 6, 2017

Despite decline in gold price for November, gold accumulations in ETF's increase by 9.1 tons as buyers still moving to safe havens

Since supply and demand do not control the gold price in Western markets, it is often difficult to see how much volume and buying affects the fundamentals of the precious metal.  And despite the fact that the price of gold has remained stagnant and within a tight range for most of November, buyers are still flocking in as seen by a new report in which ETF's increased their gold holdings by 9.1 tons.

Gold held by global exchange-traded funds increased their holdings by 9.1 tonnes in November, said the World Gold Council in a monthly report Wednesday. 
This pushed total holdings to 2,357 tonnes, an increase of 198 for the year to date, said the industry-backed gold organization. This means an addition of $8.5 billion to assets under management, an increase of 8.3% since last December. 
The November inflows were concentrated in European ETFs, as investors added 15.8 tonnes through funds listed in the region, the Gold Council said. Meanwhile, North American ETFs collectively posted outflows of 5.4 tonnes, the second straight monthly decline. Asian ETFs lost 0.3 tonne, while holdings by ETFs in other regions lost 0.9 tonne. 
In North America, iShares Gold Trust added 7 tonnes, while SPDR Gold Shares led outflows worldwide, with 11.2 tonnes leaving the vaults, the Gold Council said. In Europe, three currency-hedged funds grew: db Physical Gold Euro Hedged ETC added 5.3 tonnes, UBS ETF CH-Gold CHF Hedged added 4.2 tonnes and db Physical Gold ETC EUR added 2.3 tonne. Also, ETFS Physical Gold added 2.3 tonnes. - Kitco
Cryptocurrencies, and to a smaller extent physical gold, have remained strong assets for investors seeking safe havens as global bond markets provide little return on their money.  And in the latter half of 2017 we have been seeing large institutions move into the gold markets, but this buying has done little to move up the price in the paper driven markets.

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