Gold ETPs experience largest outflows in 2012

Gold exchange-traded products (ETPs) have experienced the largest outflows for three months, brought down by a weakening gold price, according to ETF Securities.

The exchange-traded product provider reports that total global outflows for gold amounted to $1.1 billion (£700m) last week as the price remained at its lowest point since mid-January.

Up until more recently, total gold inflows had amounted to $2.7 billion.

Stronger growth prospects from the US have started to signal potential headwinds for the commodity which has led investors to trim their short-term positions.

Longer-term gold investors however are predicted to retain their positions as real interest rates remain at record lows and the sovereign debt crisis continues to generate high risk potential.

“With net long speculative positions now near April 2009 lows, a firmer base has been set for future long-term price gains,” according to the company.