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ETF gold holdings rise by most in one quarter since 2016

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(Kitco News) - The amount of gold held by global exchange-traded funds during the first quarter rose by the largest amount since 2016, with more than half of the increase coming in March, the World Gold Council reported Wednesday.

ETF holdings climbed by 298 metric tons during the January-March period, with 151 tons added during March. This boosted holdings to a new all-time high of 3,185 tons, the WGC said. Over the past year, gold ETFs added 659 tons, the most on a rolling annual basis since the financial crisis, the WGC said.

Meanwhile, in U.S. dollar terms, the ETFs posted net-asset growth of $23 billion during the first quarter, which the WGC said was the most ever.

“Trading volumes and AUM [assets under management] reached record highs as gold volatility increased to levels last seen during the financial crisis, yet gold price-performance was mostly flat in U.S. dollars for the month [of March],” the WGC said in its analysis. “Gold prices denominated in many other currencies, however, continued to reach all-time highs although the price in U.S. dollars remained 15% below its 2011 high. This highlights a continued trend of growth in gold ETFs outside of the U.S. over the past few years – a trend underscored by European funds seeing the largest absolute inflows and Asia and other regions registering the largest percentage growth during the month.”

Holdings in Europe-based ETFs increased by 84 tons during March, while North American funds had inflows of 57 tons. Asian funds added 4.9 tons, while those for other regions rose by 4.7 tons.

Among individual ETFs, SPDR Gold Shares led global inflows with 32.7 tons. Another North American ETF, iShares Gold Trust, grew by 13.2 tons.

Two U.K.-based funds led European-fund inflows and outflows, as Invesco Physical Gold and iShares Physical added 33 and 29 tons, respectively. France’s Amundi added 16 tons, while the Xtrackers Physical EUR had outflows of 11.6 tons and WisdomTree Physical Swiss Gold had outflows of 7.6 tons, the WGC said. In China, Bosera Gold added 2.5 tons.

Most gold ETFs trade like a stock but track the price of the commodity, with metal put into storage to back the shares, thereby giving investors exposure to gold prices without having to take on costs such as storage and assaying.

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