Statistics of weekly fund flows for “Bank of America” showed yesterday (Friday), that money managers allocated $ 3.9 billion for gold, in the second largest weekly inflows ever, as well as $ 5.6 billion for cash.
The monetary tools recorded a total net flow of $ 1.1 trillion in cash since the beginning of 2020, as public isolation measures driven by “Covid-19” caused global economies to upset.
Weekly data shows that bond funds attracted $ 17.2 billion, of which $ 12.6 billion went to bonds rated at an investment grade. High-yield bonds posted net inflows in 17 out of the last 18 weeks.
Out of a $ 1.9 billion net out of stock, stocks in the United States saw the largest outflow of flows in four weeks, while money flowed into European stocks for the third week in a row. Bank of America said: “In our opinion, the biggest story in the coming era is for a larger government, a smaller world, and an unconventional financial policy that is accelerated by the pandemic, heralded by the rise of gold and the weakness of the US dollar.”
On Friday, gold rose, heading towards achieving the best monthly performance in about four and a half years, as the dollar fell more after negative US data added to doubts about a rapid recovery from the economic decline caused by the pandemic of the Corona virus, which pushed investors towards buying the yellow metal Which is a safe haven. And gold rose in immediate transactions 0.4% to $ 1967.53 an ounce by 04:58 GMT, after he suspended a series of gains that continued for nine sessions, Thursday. And gold rose in US futures 1% to 1961.30 dollars.
The US dollar fell to its lowest level in two years and is heading towards the worst monthly performance in ten years, which reduces the cost of the precious metal for investors from other currency holders.
Contrary to US data that showed the largest economic contraction in at least 73 years in the second quarter, and the increase in the number of US jobless claims, the dollar was also affected, as President Donald Trump raised the idea of postponing the US presidential elections scheduled for November 3. The second).
“The weak Q2 GDP highlights the weakening point of the economy, and investors are seeking refuge in gold,” said John Sharma, economist at the National Australia Bank. He added that the worsening of the situation of the “Corona” virus, the escalation of geopolitical tension and the decline in the dollar more, could push gold above the level of two thousand dollars. Gold has risen more than 10% since the beginning of July, achieving the largest monthly gain in percentage terms since February 2016, and rose to the highest level ever at 1980.57 dollars last Tuesday. The jump in gold gains since the beginning of the year to about 30%, driven by the exacerbation of the pandemic and low interest rates globally in light of widespread stimulus from central banks, given that the yellow metal is a hedge in the face of inflation and currency depreciation. Regarding other precious metals, silver rose 0.3% to $ 23.62 an ounce, and is on track to record the best monthly performance ever, up 30% as it receives additional support from hopes of a recovery in industrial activities. Platinum rose 0.1% to $ 903.87, and palladium gained 0.3% to $ 2,090.01.