The World Gold Council said on Thursday that index funds increased their gold holdings for the eighth consecutive month in July, by 166 tons, valued at $ 10 billion, which contributed to the rise in prices to record levels.
Investors are buying gold in huge volumes in search of an asset that will preserve its value amid the market turmoil caused by the Corona virus, which has raised the price of the metal 35% this year.
Gold this week broke the two thousand dollars an ounce barrier for the first time, and many analysts see it as a candidate for a further rise.
Index funds, which hoard gold on behalf of investors, collected 899 tons of the metal between January and July, nearly two-fifths of the total global supply over that period, according to the Gold Council.
That number greatly exceeds any previous annual increase in the holdings of index funds, and brings a total of 3785 tons in its portfolio to a value of $ 239 billion, according to the council.
Gold settled near a record high today, Friday, as the dollar regained some of its luster as a hedging tool in the face of a new escalation of US-Chinese tensions, but concerns about the worsening pandemic kept gold on its longest weekly gain in nearly ten years.
The spot price of gold recorded an unprecedented high of $ 2072.50 an ounce in early trade to $ 2062.15. The metal increased 4.4% this week, in what will be its ninth weekly gains in a row. And US gold futures advanced 0.1% to $ 2072 an ounce.
Gold, which is considered a safe haven, reached its highest level ever, last Wednesday, to continue its record high above the level of $ 2000 due to the weakness of the dollar and bets on more stimulus measures to revive the economy that is ravaged by the Corona virus pandemic.
And due to the state of anxiety that the Coronavirus pandemic raises in the markets, the value of gold has increased nearly 35% this year, making it one of the best performing assets in 2020.
Investors fear that the economic stimulus being launched in response to the pandemic will inflate and reduce the value of other assets and keep bond yields at historically low levels, which enhances the attractiveness of gold that does not yield a return.
Gold crossed the $ 2000 barrier for the first time last Tuesday, and reached a new peak of $ 2044.34 an ounce earlier on Wednesday.
By 1615 GMT, the yellow metal was up 0.87% at $ 2,035.60.
US gold futures rose 1.4% to $ 2049.20 an ounce.