Amid the sustained strength in gold prices, investment funds are accelerating their allocations to gold through ETFs, leading to rapid expansion in the scale of gold ETFs. Multiple products have recorded significant daily inflows, reaching yearly highs.
The growth in scale is driven by a balanced contribution from net subscription inflows and rising net asset values due to gold price appreciation, indicating synchronized capital deployment with market trends. Analysts note that against a backdrop of rising global macroeconomic uncertainty, increased U.S. Treasury supply pressure, and continued central bank gold purchases, gold ETFs—as a low-barrier, highly liquid investment tool—are becoming a key vehicle for capital participation in the gold market.
**Gold Prices Continue Strong Rally** International gold prices have extended their upward momentum, marking a third consecutive day of gains this week. On December 24, spot gold breached the $4,500 per ounce mark for the first time, while COMEX gold futures also climbed, briefly surpassing $4,550, setting new highs.
Gold prices have accelerated their ascent recently. On December 23, COMEX gold futures briefly exceeded $4,500 per ounce, with spot gold nearing $4,490. Domestic gold prices in China also rose sharply, with the Shanghai gold futures main contract breaking through the 1,000 yuan per gram threshold for the first time. Retail prices for branded gold jewelry also surged, with some products exceeding 1,400 yuan per gram.
**Gold ETFs See Rapid Inflows** As gold prices climbed, capital inflows into gold ETFs accelerated, driving significant expansion in fund scale. For example, Huaan Gold ETF saw its assets under management (AUM) grow by 2.598 billion yuan on December 22 and another 2.854 billion yuan on December 23, marking two consecutive days of substantial inflows. By December 23, its AUM reached 97.469 billion yuan, approaching the 100-billion-yuan milestone. The growth was evenly split between net subscriptions and valuation gains, reflecting strong investor participation.
Similarly, gold ETFs tracking the SGE Gold 9999 Index also saw notable inflows, with multiple products collectively adding 5.173 billion yuan in AUM on December 23—a high for the year. As gold prices continue to hit record highs, gold ETFs are increasingly favored as accessible and liquid investment vehicles.
**Macro Factors Supporting Gold’s Rally** Huaan Fund analyzed gold’s medium- to long-term outlook from a macro policy cycle perspective, noting that the U.S. Federal Reserve remains in a rate-cutting cycle. If a dovish chair is appointed, rate cuts could accelerate. Beyond monetary easing, the U.S. is also in a fiscal expansion phase, with rising debt servicing pressures and continued credit risks. Global central banks are diversifying reserves by buying gold, reinforcing gold’s appeal amid dual monetary and fiscal stimulus.
China Post Securities added that, amid growing U.S. Treasury supply shocks, long-duration Treasuries are losing their status as a "risk-free anchor" for institutional investors. As large-scale capital seeks alternatives, gold emerges as the only viable substitute, explaining the strong inflows into gold ETFs.
Looking ahead, China Post Securities forecasts that gold’s upward narrative faces no reversal risks in 2026, with February potentially offering the best opportunity. A U.S. temporary funding bill could expire early in the year, forcing a resolution to raise the debt ceiling, coinciding with the Treasury’s traditional peak issuance period—likely driving another gold rally.
CITIC Securities highlighted that the post-pandemic world is in a "chaotic phase," with technological shifts, fiscal expansion, trade disputes, and supply chain restructuring reshaping the global monetary system. Gold’s surge reflects deep concerns over the existing monetary order. Central bank gold purchases, particularly domestic acquisitions and onshore storage, signal preparations for emergencies and monetary system reforms.
CITIC Securities concluded that central bank buying will support gold prices in the near term, but investors should watch for a potential long-term reversal once a new monetary order emerges. However, this transition will take considerable time.
