As the paper price of gold has been hammered since hitting 52-week highs back on the 8th of September, proxy gold demand has been rising as shown in the ETFs. Buyers at least understand the concept of “buy the dip”…
Editor’s Note – Gold ETF holdings are not the same thing as holding physical gold. Physical gold, in one’s possession or one’s secure, safe-keeping, has no counter-party risk. A paper claim on gold that may or probably does not exist, and which doesn’t really have to deliver when the fine print is finally interpreted in the courts, is nothing more than a poor choice as a proxy for real physical gold.
from Zero Hedge
Amid a resurgent dollar, gold prices have tumbled in September (worst month since Nov 2016). However, as geopolitical tensions soar, with the standoff between the U.S. and North Korea probably topping the list, demand for precious metals surged with Gold ETF holdings rising most since Feb 2017.
Bullion has sunk 2.8 percent in September while holdings in gold-backed ETFs expanded 2.4 percent as of Thursday.
Plenty of investors are still seeking havens, says Barnabas Gan, an economist at Oversea-Chinese Banking Corp. in Singapore.