Why gold, silver are set to shine
London (Oct 10) Bullion has started October on the front foot after remaining weak last month.
Investors seem to be scaling down their gold exposure as overall fund flows into gold exchange traded funds (ETFs) remained negative in September, a second consecutive month of outflows. The data by the World Gold Council (WGC) shows that net outflows from ETFs stood at 15.2 tonnes following net outflows of 22.4 tonnes in July. The loss in interest can be attributed to the performance of gold as it lost about 4 per cent last month. According to WGC, higher US yields were a major driver in gold weakness, with the dollar strength also impacting to some extent. That said, investors in India seem to be capitalising on lower gold prices as domestic gold ETFs have seen an inflow of ₹446 crore in September.
The central bank’s buying of the yellow metal saw a slowdown in August, latest WGC data shows. Net central bank purchases in August were at 28.4 tonnes, the second lowest level of net monthly purchases so far this year. Thus, at the broader level, September remained a bad month for gold.
