Gold ETFs start buying gold

Net gold ETF inflows in May and June. 

J.P. Morgan

When J.P. Morgan became a custodian on 06-Dec-2022, gold and GLD diverged.

Central Banks buying gold from ETFs

Recently, the gold price has been rising while gold ETFs were flat. This started in Q4 2022. The gap is about 200 tonnes of gold in GLD.

This coincides with central bank gold buying of about 200 tonnes per quarter which started in Q3 2022.

Gold Demand Is Going Through The Roof

COMEX gold stock levels are rising. Demand is growing and is also confirmed by record GLD stock levels in the trust.

And they all want their gold delivery. We will be witnessing an explosion in the gold price.

Also may I remind everyone that we are entering a good seasonal period in gold.

GLD Trust Gold Stock Level Reaches Multiple Year High

We haven't seen these gold stock levels in the GLD trust in years. There were 1159.31 tonnes of gold in GLD on 19-Jun-2020. This looks very bullish for gold.

Why you shouldn't buy GLD

Ronan Manly talks about how GLD is borrowing gold bars from the Bank of England, which in turn are gold bars held in custody for other central banks. This tells me that there is an acute shortage of gold.

The same happened in 2016.

Gold price Vs. GLD ETF

The gold price is now almost making an all time high, while the GLD ETF holdings are not nearly at their all time highs. So I expect higher gold prices to come, as there are a lot of investors that still need to move into the GLD ETF.

India improving current account deficit supports gold price

India's current account deficit has been improving, making the odds of a tax reduction from 10% to 2% more likely. This will spur more Indian demand in gold in the future.