Gold continues advance to higher ground
World Gold Council reports notable gold ETF stockpile gains led by U.S. funds

(USAGOLD – 2/8/2022) – Gold continued its advance to higher ground this morning ahead of tomorrow’s much-anticipated data release on inflation. It is up $4.50 at $1832 in the early going. Silver is up 7¢ at $23.32. Both metals are up almost 1.5% year to date. Yesterday, the World Gold Council reported notable gold ETF stockpile gains in January led by U.S. funds. Consistent, ongoing increases in ETF inventories are usually associated with strong fund and institutional interest and, in the past, have coincided with price rallies, as shown in the chart below.

Overlay chart showing ETF flows and gold price since 2002Chart courtesy of GoldChartsRUs

“North American inflows of 49.0t (US$2.9bn),” says the WGC, “were concentrated in U.S. funds, which tend to be more reactive to changes in the gold price than other regions. Additionally, a significant jump in the gold price leading up to gold ETF options expiration likely contributed to some of the inflows. This resulted in positive flows as gold rallied by nearly 3% in the first part of January to reach an intra-month high of US$1,847/oz. The majority of U.S. inflows coincided with this move, supported by a flight-to-quality amid a selloff in equity markets.”

 

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