Investor sentiment for the precious metal gold fell to a 4½-year low last month after a moderate price rally in mid-June, according to new research by London-based online exchange BullionVault.
Gold added $76 to its price during the month of June, a rise of 6 percent, with dovish central banks and concerns over Ukraine and the Middle East giving it support. That jump subsequently deterred new buyers and spurred investors holding the metal to sell. The precious metal is traditionally seen as a “safe-haven” during geopolitical crises and its lack of yield means it also performs well in low rate environments.
Gold was still trading near three-month highs on Wednesday. Traders told Reuters physical demand from Asia – the biggest bullion buying region – has been weak due to the rise in prices. Inflows into the world’s largest gold-backed exchange-traded fund, SPDR Gold Trust, have supported prices however. The sheer size of the fund means it has a significant impact on prices.