Bloomberg the Company

Bloomberg Anywhere Login

Bloomberg

Connecting decision makers to a dynamic network of information, people and ideas, Bloomberg quickly and accurately delivers business and financial information, news and insight around the world.

Company

Financial Products

Enterprise Products

Media

Customer Support

  • Americas

    +1 212 318 2000

  • Europe, Middle East, & Africa

    +44 20 7330 7500

  • Asia Pacific

    +65 6212 1000

Follow Us

Industry Products

Gold ETP Outflows Are Seen by BlackRock at $30.9 Billion

Don't Miss Out —
Follow us on:

Aug. 7 (Bloomberg) -- Gold investments through exchange-traded products dropped $30.9 billion this year through July, as subdued expectations for inflation eroded demand for the precious metal as a hedge, BlackRock Inc. said.

Gold outflows totaled $2.6 billion last month, extending withdrawals of $4.3 billion in June, BlackRock said in an e-mailed report today. Net-outflows from commodity ETP investments this year reached $31.6 billion, after withdrawals of $2.2 billion in July.

Inflation rates tracked by the U.S. Commerce Department are running below the Federal Reserve’s 2 percent target. The Fed said last week it would maintain its $85 billion bond-buying program, while warning persistently low inflation could hamper economic expansion. Gold has tumbled 24 percent this year amid speculation the Fed would taper its stimulus program.

“Continued modest inflation readings have lessened gold’s appeal as an inflation hedge,” Dodd Kittsley, head of BlackRock ETP research, said in today’s report. Recent outflows have been “building on an exodus that started in January.”

ETP holdings in gold totaled 1,957.76 metric tons as of yesterday, the lowest since May 2010, according to data compiled by Bloomberg. The precious metal reached a three-week low in London today at $1,273.02 an ounce.

To contact the reporter on this story: Whitney McFerron in London at wmcferron1@bloomberg.net

To contact the editor responsible for this story: Claudia Carpenter at ccarpenter2@bloomberg.net

Please upgrade your Browser

Your browser is out-of-date. Please download one of these excellent browsers:

Chrome, Firefox, Safari, Opera or Internet Explorer.