Physically backed gold exchange-traded funds (ETFs) drew net inflows of $3.04 billion in the week ended August 7, extending their positive run to a third consecutive week, according to The Hindu Business Line, citing data from the World Gold Council (WGC). Total inflows reached $4.38 billion, led by the US, China and the UK, while outflows of $1.33 billion were led by the US.
The week's inflows came as gold prices climbed more than 6 per cent, with investor exits making up $3 of every $10 invested, the WGC data showed. Prithviraj Kothari, Managing Director at RiddiSiddhi Bullions Ltd and President of India Bullion and Jewellers Association Ltd, said gold surged roughly 6.6 per cent last week to near $4,350 an ounce after July US payrolls rose by just 23,000 against expectations of an 80,000 gain. That pushed Federal Reserve rate-hike odds for September down to 44 per cent from 55 per cent, according to Kothari.
Analysts see support; profit-booking risk remains
Kothari placed the key support zone at $3,950–4,000. Darshan Desai, CEO of Aspect Bullion & Refinery, said the yellow metal remains well supported after recently touching a seven-week high, with underlying sentiment towards bullion remaining positive.
"While some profit-booking may emerge amid a stronger dollar, investors continue to view gold as an important store of value amid global economic and geopolitical uncertainty." — Darshan Desai, CEO, Aspect Bullion & Refinery
Weekly flows: US leads, Canada redeems
During the week ended August 7, Canadian investors redeemed $526 million, while US investors added $1.6 billion. Chinese buyers contributed $796 million, UK investors $663 million, and Swiss and German investors each brought in over $200 million.
| Market | Weekly net flow |
|---|---|
| US | +$1.6 billion |
| China | +$796 million |
| UK | +$663 million |
| Switzerland | >$200 million |
| Germany | >$200 million |
| Canada | -$526 million |
Year-to-date: China and India anchor inflows
Net year-to-date investments in gold ETFs stand at $13.69 billion, with $92.99 billion of inflows against $79.3 billion of outflows, The Hindu Business Line reported. China and India together contributed $11 billion. Chinese investors have turned net positive at $7.12 billion, followed by Indian investors at $3.96 billion. UK inflows total $3.6 billion and Swiss inflows $2.5 billion. Japan and Korea are net positive at over $650 million, Hong Kong SAR at $956 million, Germany at $537 million, and Singapore at $322 million.
| Market | YTD net flow |
|---|---|
| China | +$7.12 billion |
| India | +$3.96 billion |
| UK | +$3.6 billion |
| Switzerland | +$2.5 billion |
| Hong Kong SAR | +$956 million |
| Japan & Korea | +$650 million (combined) |
| Germany | +$537 million |
| Singapore | +$322 million |
| US | -$6.23 billion |
| Canada & Italy | >-$230 million (combined) |
Price action and macro backdrop
Gold was ruling around $4,332 an ounce on Monday, after hovering near $4,000 for much of the second half of July. The metal has shed 23 per cent from its record high of $5,608 an ounce reached on January 29 this year, declining on fears of inflation, a Fed rate hike and rising bond yields. The rally that began in 2024 was driven by hopes of Federal Reserve rate cuts, geopolitical tensions and concerns over US trade disputes with various countries, mainly China. Unresolved Strait of Hormuz tensions and a US-Japan intervention to support the yen added further volatility. The rupee traded between 94.89 and 95.46 against the dollar, while Indian demand remained investment-led ahead of the festive season.
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