Gold-backed exchange-traded products (ETPs) experienced robust investment demand in the first month of 2026, marking a strong start to the year, according to monthly ETF data from the World Gold Council (WGC). This occurred despite significant selling pressure on the final trading day of January. The WGC reported that global gold ETFs saw net inflows of 120 tonnes last month, valued at nearly $19 billion, setting a new record for the strongest monthly inflow ever. The report highlighted that total global gold ETF holdings increased to a record 4,145 tonnes, surpassing the previous peak set in 2020. Over the same period, the gold price rose by 14%, driving the total value of gold holdings to a new historical high of $669 billion. Analysts noted that investors continued to buy gold ETFs even as the metal experienced one of its largest declines in decades and selling pressure persisted.

Asian demand dominated the global market last month. ETFs in the region saw net inflows of 62 tonnes, valued at approximately $10 billion. This marked the fifth consecutive month of net inflows for the region and represented its best monthly performance on record. Analysts stated, "Asia accounted for 51% of global net inflows, a particularly notable performance considering the region's holdings are only one-fifth the size of North America's." "China once again led Asian inflows ($6 billion), ranking second globally, behind only the United States. Strong gold price appreciation, persistent geopolitical uncertainty, and robust institutional demand collectively supported sustained enthusiasm for gold ETFs in China."

North American-listed gold ETFs also showed strong activity, with investors purchasing 43.4 tonnes of gold valued at nearly $7 billion last month. Analysts pointed out, "Gold saw a significant pullback at the month's end following the nomination of a new Federal Reserve Chair. Gold prices were clearly overbought in January, making a correction almost inevitable. Despite the price decline and increased volatility, the region still recorded net positive inflows on the final trading day of the month." "Inflows during the month were supported by the rising gold price and escalating geopolitical tensions involving the US, Iran, Greenland, and parts of Europe, which helped maintain investor interest in gold."

European demand, while positive, lagged behind Asia and North America. European investors bought nearly 13 tonnes of gold, worth approximately $2 billion. Analysts commented, "The region faced broader market volatility, including the EU's preparation for retaliatory tariffs and pressure on export-oriented economies, which reinforced demand for defensive assets like gold." "The United Kingdom led European inflows, as persistently high inflation and renewed political tensions further encouraged investors to use gold ETFs as a hedge against domestic and international risks."

Although the gold price has retreated significantly from its peak near $6,000 per ounce in January, WGC analysts believe investment demand for gold will remain a key support for the market in 2026. In their monthly commentary, they noted that the low interest rate environment, stubborn inflation, and renewed expansion in government spending make gold a more attractive safe-haven asset than bonds. Analysts said, "After the recent rapid price ascent, gold may need a period of consolidation, but we expect sustained investment demand to be a key feature of 2026." "Geopolitics remains a primary driver, and the macroeconomic environment is likely to further reinforce this trend. The most likely scenario is a renewed rise in inflation expectations ahead of mid-term elections, fueled by fiscal stimulus, which would push up the correlation between equities and bonds."