by Adam Hamilton
Zeal LLC
Gold investment capital flows are a primary driver of gold-price trends, fueling both major uplegs and corrections. Massive outflows from dominant gold exchange-traded funds really intensified gold’s recent extended correction into early March. But gold’s young upleg since has increasingly dampened that mass exodus of American stock traders. Stabilizing gold investment precedes new buying, which is bullish for gold.
The venerable World Gold Council tracks and publishes the best-available global gold fundamental data on supply and demand. The all-important demand side is broken down into four categories which are jewelry, investment, central banks, and technology. That’s normally their size order. From 2015 to 2019, these categories averaged accounting for 51%, 29%, 12%, and 8% of overall global gold demand each year.
But 2020’s pandemic chaos shuffled these rankings, with lockdowns hammering jewelry demand while investment demand exploded.