China’s gold market in July: despite the gold consumption off season, local gold ETFs continued to see inflows
Explore China's gold market in July - gold price, consumer demand, outlook and more!
Gold ETFs continue growth with slight inflows in July
Flows into global gold ETFs were marginally positive in July, with inflows of 11.1 tonnes (t) (US$669mn, +0.3% AUM). Inflows into European and Asian funds were mostly offset by outflows from large North American funds. Overall, the positive flows came alongside a recovery in gold prices, particularly in the latter half of the month amid concerns of uncertain global growth outlook and a reaffirmed commitment by central banks to continue easy money policies despite elevated inflation. Global Assets Under Management (AUM) stand at 3,636t (US$214bn), approximately 7% below the October 2020 record tonnage high of 3,909t.
The three-child policy and its implications for China’s gold consumption
While the possible outcomes of the three-child policy and various supporting measures remain uncertain, we believe there is a link between birth rates and gold consumption, and the details are worth analysing.
Gold Demand Trends Q2 2021
Strong consumer demand recovery and Q2 gold ETF inflows were not enough to offset heavy Q1 outflows.
Gold ETF flows slow in June but finish positive in Q2
Flows into global gold ETFs were mostly flat in June, with slight inflows of 2.9 tonnes (t) (US$191mn, +0.1% AUM). Inflows into North American and Asian funds were primarily offset by outflows from European funds. Overall, the positive flows came in spite of significant gold price weakness in the latter half of the month on the heels of a relatively hawkish Federal Reserve (Fed) outlook, suggesting that investors may have taken advantage of the lower price level to gain long gold exposure. Global Assets Under Management (AUM) stands at 3,624t (US$206bn), approximately 7% shy of the October 2020 record tonnage high of 3,909t.
India’s gold market in June: retail demand improved as lockdowns eased
China’s gold market in June: Chinese gold ETF holdings rose despite a fall in the gold price
International gold prices fell steeply in June. The weakness in the gold price can be largely attributed to the more-hawkish-than-expected monetary-tightening signals from the US Federal Reserve’s meeting on 18 June. But the decline in the RMB gold price was narrower than that of the USD gold price, thanks to a 1.6% depreciation in the CNY against the dollar last month.
Gold mid-year outlook 2021
Interest rates will likely remain key drivers of financial assets. Gold is no exception. Yet, the negative impact of higher rates will likely be offset by the longer lasting effects and unintended consequences of expansionary monetary and fiscal policies created to support the global economy.
