Year-to-date, outflows from gold ETFs have reached $2.39 bln, while inflows into exchange-traded funds based on the leading cryptocurrency stand at $3.89 bln. What is the reason for this situation? And how does it change the market?
The performance of ETFs and digital instruments is likely to attract much more attention this year than gold. This is what’s behind the outflow of funds from gold ETFs. In addition, gold is sensitive to the performance of the US dollar and the Fed’s interest rate trajectory. This is all quite ambiguous, since the market tends to avoid the associated risks and goes where it is easier and more logical to make money.
Money must work – this is the ironclad reasoning that underpins capital markets. That's right: capital flows are allocated to places where the dynamics do not raise questions.
Price movements confirm these observations. The gold price slid to $2,000/oz in February, while the BTC price has been pushing above two-year highs.
