Gold ETFs Lose 74.3 Tonnes in June Despite Positive First Half of 2026

The latest report from the World Gold Council (WGC) revealed that global gold-backed exchange-traded funds (Gold ETFs) recorded net outflows of 74.3 tonnes in June 2026, valued at nearly US$9 billion, marking one of the largest monthly withdrawals in recent months as rising real yields and a stronger U.S. dollar increased the opportunity cost of holding gold following more hawkish monetary policy expectations.

Despite June's weakness, the report noted that global gold ETFs finished the first half of 2026 on a positive note, recording net inflows of 17.6 tonnes worth approximately US$8 billion, highlighting continued investor interest in gold despite the sharp market volatility experienced during the second quarter.

According to the report, North American-listed gold ETFs accounted for the largest share of the global outflows, shedding 42.4 tonnes valued at US$5.5 billion during June.

The World Gold Council attributed the selloff to what markets interpreted as more hawkish signals from newly appointed Federal Reserve Chair Kevin Warsh, coupled with heightened inflation concerns stemming from escalating tensions between the United States and Iran. These developments strengthened expectations that interest rates would remain higher for longer, pushing both real yields and the U.S. dollar higher and increasing the opportunity cost of investing in gold.

The pressure was clearly reflected in the bullion market, where gold prices fell below their 200-day moving average and briefly slipped beneath US$4,000 per ounce as investors continued to liquidate ETF holdings.

Despite the recent weakness, WGC analysts believe the correction has brought gold prices back to more attractive valuation levels, creating favorable conditions for renewed investment demand in the months ahead.

The Council's 2026 Mid-Year Gold Outlook projects relatively stable gold performance during the second half of the year while emphasizing that several potential catalysts could trigger a fresh breakout should geopolitical risks intensify, global economic growth slow further, or financial market volatility increase.

The report added that persistent global uncertainty is likely to sustain investor demand for portfolio protection, supporting renewed inflows into gold ETFs as a strategic safe-haven allocation.

In Europe, gold ETFs recorded net outflows of 12.1 tonnes worth US$817 million after the European Central Bank raised interest rates by 25 basis points for the first time since September 2023. The move increased the appeal of interest-bearing assets while reducing demand for gold. Continued outflows from currency-hedged ETF products, particularly those listed in Switzerland amid local currency weakness against the U.S. dollar, also weighed on regional fund performance.

Across Asia, gold ETFs experienced net outflows of 71.5 tonnes valued at US$2.2 billion during June. Nevertheless, the WGC noted that Asian-listed funds still delivered their strongest first-half performance on record.

The report explained that most of the regional outflows originated from China, where improving investor sentiment toward equities and lower gold prices encouraged portfolio reallocation. Japanese funds also recorded outflows after the Bank of Japan raised interest rates, increasing the opportunity cost of holding gold.

In contrast, India bucked the global trend by attracting net inflows during June, as domestic investors viewed the price decline as an attractive buying opportunity and remained optimistic about gold's medium- and long-term prospects.