According to published data, the SPDR Gold Trust has been aggressively accumulating gold. With an additional 3 tons of gold traded this week, the fund now holds 843 tons. This marks the second consecutive week that this major gold buyer has been net buyers, with a total transaction volume of 8 tons of gold.

Joe Cavatoni, chief market strategist for North America at the World Gold Council (WGC), said that global gold ETFs are beginning to react to geopolitical risks. The main factor influencing gold prices will be interest rate cuts from central banks.

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"Sharks" are buying gold. Photo: Kitco

The World Gold Council (WGC) is closely monitoring global ETF flows as gold prices once again surpassed the $2,400/ounce mark. According to the WGC, gold holdings by ETFs decreased by 16.2% in the second quarter.

Cavatoni predicts that as the US Federal Reserve (Fed) begins cutting interest rates, the opportunity cost of holding gold will decrease. This makes gold more attractive to investors seeking safety and diversification in a low-interest rate environment. This will be a major driver in attracting Western investors back to the gold market.

Previous data showed that ETFs had been net sellers for a long period, amidst a sharp rise in gold prices. The gold price surge has temporarily subsided, and investors are now seizing the opportunity to buy.

Gold prices on the Kitco exchange closed the trading week at $2,368 per ounce. August 2024 gold futures traded at $2,385 per ounce.

James Stanley, senior Forex strategist, says that the long-term outlook for gold prices remains good, but in the short term, the technical outlook is showing more challenges.

Colin Cieszynski, chief strategist at SIA Wealth Management, believes that when the Fed signals a rate cut, the USD could fall and gold prices could rise sharply. In the long term, funds may also increase their appetite for investing in precious metals.