Demand for Gold Surges: Record ETF Inflows

The gold price shines bright again as passive investors seek gold as a safe haven asset, moving away from uncertain equity markets amid global economic weakness 

Karen Kwok 17 May, 2016 | 10:52AM

Inflows of gold exchange-traded fund in Europe have reached €4.9 billion year to date, making it the most popular sector among passive investors, according to data from Morningstar Direct. 

In February 2016, the precious metals ETFs sector in Europe recorded the largest inflows of €2.6 billion in five years – thanks to the tailwinds of uncertainty around China’s economy and negative bond yields in Europe and Japan. A weak US currency also further bolster the gold as an attractive investment, especially to non-US investors as gold is priced in dollars, Michelle McGrade, chief investment officer at TD Direct Investing says.

“Gold is an important hedge during uncertain conditions, since it tends to have a low correlation to the broader economic environment,” she said.

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Securities Mentioned in Article

Security NamePriceChange (%)Morningstar
Rating
BlackRock Gold and General A Acc1,009.72 GBP1.12
BlackRock World Mining Trust plc283.00 GBP5.60

About Author

Karen Kwok

Karen Kwok  is a Reporter for Morningstar.co.uk

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