Gold, which has gained nearly $200 this week, was ruling around $4,000 an ounce in the second half of July. This encouraged investors to return to ETFs, as they found value.
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Investments in physically backed gold exchange-traded funds (ETFs) continued to be positive for the second week in a row last week. However, there was a $7 outflow for every inflow of $10, data from the World Gold Council (WGC) showed.
In the week ended July 31, inflows, led by Asia and Europe, into gold ETFs were $1.3 billion, while outflows, led by the US, were $0.90 billion.
Year-to-date, China and India are the main reasons for net investments in the ETFs staying positive, while investors in the US have chosen to book profits. Inflows till July 31 this year were $88.62 billion, while exits were to the tune of $77.97 billion.
Indian investments 3rd biggest
Last week, investors in the US redeemed $313.6 million, while those in Canada redeemed $141 million. Chinese investments totalled $294 million, followed by those in the UK at $236 million. Inflows in India were the third at $156.8 million.
Gold, which has gained nearly $200 this week, was ruling around $4,000 an ounce in the second half of July. This encouraged investors to return to ETFs, as they found value.
Currently, gold is quoted at $4,298 an ounce, up over 6 per cent this week.
Year-to-date, investors in the US have encashed $7.8 billion, while those in Italy and France have taken away $235 million and $219 million, respectively.
Indian investors steadfast
On the positive side, Chinese investments are net positive at $6.32 billion, while Indian investments are $3.97 billion. Indians are probably the ones who have stood steadfast with their investments in gold ETFs this year. Chinese investors have encashed over $3 billion soon after the Iran war broke out. Investments are net positive in the UK at $2.9 billion, in Switzerland at $2.3 billion, Hong Kong at $951 million, South Korea at $693 million, Japan at $670 million and Singapore, Australia and Canada at over $230 million each.
Prithviraj Kothari, Managing Director at RiddiSiddhi Bullions Ltd, and President of India Bullion and Jewellers Association Ltd, said gold has broken above $4,200 on hopes of a diplomatic breakthrough between the US and Iran.
This will ease pressure on crude oil prices, improving Investor sentiments. “Technically, gold eyes $4,500,” he said.
Renisha Chainani, chief research officer at Augmont, said optimism over a peace deal in West Asia pulled inflation expectations lower, helping gold break out of a multi-week range above $4,200.
Down 25% from peak
“Markets now price a 55 per cent probability of a US rate hike in September, down from 63 per cent a week earlier, she said.
After soaring to a record high of $5,608 an ounce on January 29 this year, gold has shed nearly 25 per cent of its gains. The precious metal has been declining on fears of inflation, a hike in US Fed rates, rising bond yields and investors finding the crude oil complex attractive.
Gold had a sizzling rally since 2024 on hopes of a cut in US Fed rates, geopolitical tensions and the US trade dispute with various countries, mainly China.
Published on August 7, 2026
