Central Bank Impact on Gold Prices Despite ETF Outflows
Central Banks vs. ETFs - A Divergent Trend
Central banks have been aggressive buyers of gold since 2020, accumulating significant reserves while global gold ETFs experience continuous outflows. Despite economic uncertainties and geopolitical risks, central banks view gold as a hedge against volatility.
Economic and Geopolitical Drivers
Trust deficits and diversification from the U.S. dollar have driven central banks to increase their gold reserves for economic security. Notable examples include Turkey and China, showcasing a shift away from dollar-denominated systems.
ETF Outflows and Market Behavior
Gold prices remain resilient despite ETF outflows, indicating a strategic approach by central banks and a divergence in market behavior. The stable value of gold amidst deflationary pressures in crude oil strengthens its performance in 2024.
This article was prepared using information from open sources in accordance with the principles of Ethical Policy. The editorial team is not responsible for absolute accuracy, as it relies on data from the sources referenced.