Gold remains attractive in Q3 2020

The scale of the coronavirus pandemic and its potential impact on the global economy made investors lean towards assets that are considered a safe haven in times of crisis. As presented in the latest Gold Demand Trends Q3 2020 report in the third quarter of this year we could observe a strong inflow to gold-powered ETFs. Quarterly it was at the level of 272.5 tonnes, which led to a new global record – 3,880 tonnes. While the pace has slowed down somewhat since H1, the sustained earnings in the third quarter indicate continued incentive for ETF investors to increase their assets. Moreover, it could also have been influenced by low-interest bank deposits, deposits and bonds.

Although overall demand decreased in the third quarter of this year, there was a significant increase in investment demand by 21 percent to 494.6 tonnes.

“The results of the latest World Gold Council report confirm analysts' predictions. Investment demand remains the dominant factor in the area of ​​gold. Most likely – in the near future – it will maintain its pace of growth due to the still felt effects of the coronavirus pandemic,” Aleksander Pawlak, President of the Management Board of Tavex, said.

In his opinion, iInvestors are looking for alternative, safe assets. Therefore, the increases were mainly generated by investment funds investing in physical gold.

Growing investment demand can also be seen in the renewed interest in bullion bars and coins. The World Gold Council reported that global demand for gold bars and coins rose as much as 49 percent  in the third quarter compared to the same period a year ago.

(WBJ)