Why demand for gold is rising, and expected to continue amid volatility

Why demand for gold is rising, and expected to continue amid volatility


“Many exposures were bubbling up before the pandemic. They just took a backseat as the world focused on it. But, now, many of these risks are resurfacing, and I think investors are choosing where they want to put their dollars to ensure they have proper risk mitigating strategies and asset allocation.”

Artigas said the council saw a $50 billion gold ETF in-flow in 2020, but when sentiment started to improve in 2021, there was a $9 billion outflow, “which tells you that there’s a lot more strategic buying for the long-term.” In Q1 2022, there was another $12 billion in-flow.

“What’s interesting from our perspective is it has been consistently increasing for various reasons,” he said, noting many investors use high-quality assets, like gold to diversify, mitigate risk, and provide good long-term returns.

Artigas noted gold’s dual nature – as an investment, but also for jewellery and electronic consumption – allows it to capture some of the upside, when there is positive economic growth, which spurs on jewellery and electronics demand, but also protect the downside by providing a safe haven during periods of risk, and the Q1 results for 2022 show that mix.

During that time, The World Gold Council reported that, gold ETFs jumped by $69 trillion (US) in Q1, recording their strongest quarterly inflows since Q3 2020.



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