Election response
The first week of November saw gold move lower after hitting a new all-time-high on the first of the month.
According to our Gold Return Attribution Model (GRAM), gold was pressured lower by strength in the US dollar and momentum factors including the lagged gold price, gold ETF outflows which were coming off an exceptionally strong month, and a drop in COMEX net managed money net longs – reflecting the likely unwind of pre-election hedges.
Global gold ETFs shed an estimated US$809mn (12t) during the first week of November, with the bulk of outflows stemming from North America, which were partially offset by strong Asian inflows. Potentially signalling renewed fears around the resumption of the trade war between the US and China. Additionally, COMEX net positioning also fell 74 tonnes, an 8% drop from the prior week.
