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Gold March 15, 2019 11:45:57 AM

Gold-Backed ETF Holdings Declined Substantially in February

Paul Ploumis
ScrapMonster Author
Meantime, year-to-date gold-backed ETF flows remained strong, mainly on account of robust inflows in January.
Gold-Backed ETF Holdings Declined Substantially in February

SEATTLE (Scrap Monster): After four consecutive months of inflows, the gold-backed ETF holdings reported notable outflows in February 2019. The holdings dropped by 33 tonnes during the month. In accordance with the data published by the World Gold Council (WGC), the outflows were valued at $1.3 billion. Also, the holdings totaled 2,479 tonnes at the end of February this year.

Meantime, year-to-date gold-backed ETF flows remained strong, mainly on account of robust inflows in January. It must be noted that global gold-backed ETFs had witnessed addition of 72 tonnes in Jan ’19 to take the total holdings of around 80 ETFs to 2,513 tonnes- the highest level in nearly six years.

Juan Carlo Artigas, Director of Investment Research, WGC noted that the rising sense of comfort towards stock market investments, especially by a few U.S. investors, trimmed the flow to gold-backed ETFs. This resulted in flows being redirected from gold to stock-based and broad-based funds, he said. The prospects of a possible trade deal and a strengthening dollar are also cit5ed as reasons for erosion of demand for bullion.

The largest gold ETF, GLD continued to witness notable withdrawals during early-March as well, recording straight fourth week of outflows. The ETFs tracking gold miners have also seen huge drop in holdings. The VanEck Vectors Gold Miners ETF and the VanEck Vectors Junior Gold Miners ETF saw cash outflow of $148 million and $142 million respectively during the first week of March this year.

 

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