Gold-backed exchange-traded funds experienced their biggest single-day inflow in nearly three years on Friday, with investors pouring 27 tons into the precious metal as prices soared to fresh record highs.
The massive influx is the largest single-day surge in nearly three years, according to Bloomberg data. SPDR Gold Shares, the world’s largest gold ETF, alone attracted 19 tons of the total inflows.
Gold prices hit an all-time high of $3,783.31 per ounce on Tuesday, extending a rally that has seen the precious metal gain about 40% this year. The surge has been driven by expectations of Federal Reserve interest rate cuts and growing geopolitical uncertainties.
“Strong buying interest from ETF investors is likely to have given the gold price a boost,” said Carsten Fritsch, commodity analyst at Commerzbank AG.
September has proved particularly strong for gold investments, with ETF inflows totaling 88 tons for the month after an additional 8.7 tons were added earlier in the week.
The buying frenzy comes amid expectations of further Fed rate cuts following the central bank’s 25-basis-point reduction on September 17. Lower interest rates typically benefit gold, which pays no yield, by reducing the opportunity cost of holding the metal.
Additional factors supporting gold include President Donald Trump’s continued criticism of Fed independence and China’s efforts to diversify gold storage away from Western custodians, according to market analysts.
Central banks have also been major buyers, with China increasing its gold reserves for 10 consecutive months as part of broader efforts to reduce reliance on U.S. dollar holdings.
The 2025 inflows are on track to potentially surpass the record $49.5 billion that flowed into gold ETFs in 2020 during the pandemic-driven market turmoil.
JP Morgan recently raised its gold price forecast, now expecting the metal to reach $4,000 per ounce by the second quarter of 2026.
Information for this story was found via Bloomberg, and the sources and companies mentioned. The author has no securities or affiliations related to the organizations discussed. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
