Gold prices are stable near their highest level in more than four months, and there are signs that investors are more bullish on gold.
Hedge fund managers increased their net long positions in gold to their highest level in 16 weeks, according to data released on Friday. Gold ETFs saw inflows in May after gold prices strengthened for three months in a row, according to data collected by Bloomberg.
Gold rose for three consecutive weeks, reflecting investor concerns about inflation risks and surging coronavirus cases in some countries. Market-based indicators of inflation expectations have fallen recently, and investors are weighing the extreme volatility of Bitcoin, which may provide additional support for gold's strength.
"Gold prices are on an upward trend as weak cryptocurrencies and rising demand for inflation-hedging assets boost gold's attractiveness," said Margaret Yang, a strategist at DailyFX. Recent ETF data show that investors are hoarding gold for the first time since January, highlighting the continued rise in safe-haven demand for gold. "
As of 11:22, Singapore spot gold rose 0.2 per cent to $1884.5 an ounce. Gold climbed to $1890.13 last week, its highest level since Jan. 8. In addition, silver, palladium and platinum all rose. The Bloomberg dollar spot index was flat after rising 0.2% on Friday.
Former US Treasury Secretary Summers (Lawrence Summers) said cryptocurrencies could still be a major concern in global markets, similar to "digital gold", even though their importance in the economy is still limited.