Gold continues to benefit from the current market uncertainty. Prices have repeatedly reached record levels recently. The $3000 per troy ounce barrier is becoming closer, and there is a high probability that it will soon be reached. While investor interest in ETFs replicating physical commodities seems to be increasing again, the traditional demand for jewellery is weakening. This is confirmed by the recent decline in metal imports to China from Hong Kong.
Just a dozen or so months ago, the $3000 barrier seemed to be a level that was unrealistic to reach. Now, this psychological barrier is within reach. Although Friday brought a slight correction to $2920 (which could be due to short-term profit-taking), there are currently no signals reversing the trend. The demand for gold is currently driven mainly by Western investors and central banks.
However, ETF investors seem to be joining the trend. During the last few trading days, the world’s largest gold-based ETF fund recorded an influx of over 20 tons of gold. The resources of gold ETFs tracked by Bloomberg reached their highest level since January 2024 last Thursday. The increasing interest of investors suggests that a further increase in gold prices is very likely.
Evidence of a shift in gold demand from Asia to the West is the recent data published by the Swiss Federal Customs Administration. Switzerland exported 225 tons of metal in January, of which the majority (over 190 tons) went to the US market. This explains the increase in gold reserves on the COMEX.
The movement is also noticeable in the United Kingdom. A total of 14 tons were imported from there, leading to a sharp drop in London’s reserves. Meanwhile, 9.3 tons were exported to the UK, which could be attributed to the inflow of capital into local ETFs.
On the other hand, high metal prices are impacting demand from China and India, which have always been seen as the major consumers.
Łukasz Zembik, Oanda TMS Brokers
Disclaimer: The information contained in this publication is for informational purposes only. They do not constitute financial or any other advice, are general in nature, and are not addressed to any specific recipient. Independent advice should be sought before using the information for any purpose.
Source: https://ceo.com.pl/cena-zlota-bije-kolejne-rekordy-psychologiczna-bariera-3000-usd-na-horyzoncie-34354
