ETFs tracking the precious metal have suffered losses and outflows while the U.S. stock market as measured by the S&P 500 has climbed to new all-time highs. Gold prices are falling as central bank stimulus measures haven’t stoked runaway inflation and as the metal loses some of its safe-haven allure.
Despite the weakness in gold futures and ETFs, demand for physical gold has been surprisingly robust, CNNMoney reports.
“It’s reasonable to say that the currency debasement and easing measures will support gold,” said Alan Gayle, a senior strategist at RidgeWorth Capital Management, in a Bloomberg article. “The bulls still have to prove a lot. There is lot of skepticism surrounding gold. We have to watch to see if prices have found a near-term bottom.”
Full disclosure: Tom Lydon’s clients own GLD.