Gold ETFs Shed $8.9B in June as Fed's Hawk Returns to the Nest 🪙

Investors withdrew $8.9 billion from gold exchange-traded funds in June, with North American products accounting for $5.5 billion of the exits as bullion logged its fourth consecutive losing month, according to a World Gold Council report. The metal fell 11.7% during the period as a hawkish Federal Reserve and Middle East tensions pushed investors away from the safe-haven asset. New Fed Chair Kevin Warsh signaled a hawkish stance, while the US-Iran conflict lifted inflation fears, together raising expectations of higher rates ahead. Rising real yields and a stronger dollar increased the opportunity cost of holding non-yielding gold.

Total assets under management across global gold ETFs fell 13% to $526 billion in June, while holdings dropped 74 tonnes to 4,047 tonnes. North American funds recorded $7.7 billion in outflows across the first half, the region's weakest start to a year since 2013. European funds lost $818 million in June after the European Central Bank raised rates 25 basis points, its first increase since September 2023. Markets outside the three major regions also turned negative, with combined outflows totaling $262 million, bringing their 2026 net buying to $106 million. Australia accounted for most of that drop at $197 million, and South Africa gave up $36 million.

"Looking ahead, regional gold ETF flows could stabilise…Meanwhile, uncertainties surrounding geopolitics, economic growth and financial markets linger. This backdrop may continue to support investor demand for portfolio protection and sustain interest in gold ETFs as a strategic safe-haven allocation," the report stated. Despite the June retreat, global flows remained positive at $8 billion over the first half of 2026. Asia led with $12 billion in additions, its strongest first half on record, even after a $2.3 billion June outflow that marked the region's worst month ever, driven mainly by Chinese funds. India bucked the trend, drawing inflows as local investors treated the price dip as an entry point. Collective global holdings rose 18 tonnes across the half, though assets under management fell 6% on the lower price.