Gold ETF inflows amid central bank activity

In early August 2026, the Federal Reserve’s decision to hold the federal‑funds rate at 3.50‑3.75% and its hint at a possible 25‑basis‑point hike spurred a wave of investment into gold‑related exchange‑traded funds. Chinese domestic gold ETFs recorded net inflows of roughly ¥85.8 billion for July, led by HuaAn Fund Management and Yongying Fund Management, while global funds such as the SPDR Gold Trust added 3.37 tons of gold – the largest weekly purchase since mid‑June. The inflows were linked to higher U.S. Treasury yields and a broader view of gold as a hedge against rate‑related uncertainty.

A few days later, the People’s Bank of China increased its gold holdings in Hong Kong, supporting the city’s ambition to become a regional bullion hub. The central bank added about 20 metric tons in July, the strongest monthly purchase since October 2023, extending a 21‑month streak of rising reserves to roughly 76 million ounces (valued at over $306 billion). It also accelerated the transfer of gold previously stored in London to Hong Kong, underpinning a newly trialled central gold‑clearing and settlement system aimed at challenging established centres such as London and Singapore.

Domestic demand reinforced the trend, with Chinese investors pouring more than $1.2 billion into gold‑backed ETFs during the longest inflow streak since March and year‑to‑date ETF inflows reaching about $5.6 billion. The combined official‑sector buying and private demand helped keep gold prices around $4,200 per ounce, highlighting the growing role of ETFs in channeling both private and sovereign capital into the metal.