India Defies Global Gold ETF Sell-Off With $388 Million Inflows in June, Says WGC

India bucked the global trend in June 2026 by attracting $388.50 million (around Rs 3,708.70 crore) into gold exchange-traded funds (ETFs), even as investors across major global markets pulled money out of the asset class, according to the World Gold Council's (WGC) latest Gold ETF Commentary. The inflows made India one of the few markets to register net additions during the month, highlighting resilient domestic demand even as sentiment weakened elsewhere.

Globally, physically backed gold ETFs saw net outflows of $8.90 billion (around Rs 85,014.67 crore) in June, with all regions recording withdrawals. Total assets under management (AUM) fell 13 per cent month-on-month (m-o-m) to $526.30 billion, while total gold holdings declined by 74.30 tonnes to 4,047 tonnes. Despite the June outflows, global gold ETFs received net inflows of $8.04 billion during the first half of 2026, supported by strong buying in Asia earlier in the year, although North America remained the only region to post net outflows during the six-month period.

India Stands Apart In Asia

India emerged as the lone bright spot in Asia during June, as the region recorded its worst-ever monthly gold ETF outflows of $2.28 billion (around Rs 21,795.22 crore). The withdrawals were driven largely by Chinese funds, while Japanese investors also pared their holdings during the month.

The WGC attributed India's contrasting performance to continued investor confidence in the precious metal. "India buckled the trend, attracting inflows in the month as local investors remained optimistic about the gold price and view the dip as entry opportunities," the report said.

India attracted $388.5 million (around Rs 3,708.70 crore) into gold ETFs in June. For the first six months of 2026, cumulative inflows stood at $3.90 billion (around Rs 37,204.28 crore), taking total holdings to 119 tonnes. Assets under management reached $17.7 billion by the end of the month, according to the WGC.

Association of Mutual Funds in India's (Amfi) latest data also showed a sharp turnaround in investor sentiment. Gold ETFs attracted net inflows of Rs 3,443.23 crore in June 2026 after seeing net outflows of Rs 725 crore in May.

Nippon India ETF Gold BeES ranked among the world's top-performing gold ETFs in June with $158.4 million in inflows, while SBI-ETF Gold attracted $81.2 million, placing both Indian funds among the month's top ten gainers globally.

Nehal Meshram, Senior Analyst, Morningstar Investment Research India, said, "Following the profit-booking witnessed in the previous month, investor interest in gold revived amid ongoing geopolitical uncertainties, concerns around global growth and uncertainty surrounding the trajectory of global interest rates. The renewed inflows suggest that investors continue to view gold as an effective hedge against macroeconomic and market-related risks despite elevated prices."

Why Global Investors Turned Cautious

The WGC attributed June's global outflows largely to changing interest-rate expectations and weakness in gold prices.

In North America, which accounted for the largest withdrawals of $5.54 billion (around Rs 52,927.53 crore), the report said, "The notable gold price pullback in the month served as a key driver for investors to dial back their allocation to gold ETFs." It added that "As new Fed Chair Warsh sent hawkish – as the market interpreted – signals and the US-Iran conflict pushed inflation fears up, expectations intensified of higher interest rates ahead. This anticipation contributed to rising real yields and a strengthening dollar, pushing up investors' opportunity costs of holding gold."

Europe also recorded $817.6 million (around Rs 7,806.05 crore) in outflows during June. According to the WGC, "Across the region we believe gold price weakness has been a major factor leading to net sales of gold ETFs by investors." The report also noted that the European Central Bank's 25-basis-point rate increase, prompted by inflation concerns amid the US-Iran conflict, may have discouraged some investors from holding gold. Continued outflows from Swiss-listed currency-hedged products also added to regional losses.

Asia posted $2.28 billion in outflows despite remaining the strongest-performing region during the first half of the year, with $12.43 billion in cumulative inflows. The WGC said the June decline was "mainly from Chinese funds, as local investor risk appetite continued to improve amid equity market gains and a weaker gold price." It added that "Japanese funds also saw outflows in the month as the Bank of Japan hiked rates, pushing up local investors' opportunity cost of holding gold."

Funds in other regions posted relatively modest outflows of $262.2 million (around Rs 2,503.35 crore), largely due to withdrawals from Australia and South Africa.

H1 Flows Stay Positive Despite June Outflows

Despite the June sell-off, global gold ETFs remained in positive territory during the first half of 2026. Net inflows stood at $8.04 billion, while collective holdings rose by 17.60 tonnes. Global AUM, however, declined 6 per cent to $526.30 billion, mainly due to lower gold prices rather than sustained investor selling.

The WGC said global gold ETF trading activity rose 23 per cent m-o-m to $6.90 billion a day in June, while average daily trading in the first half increased 73 per cent from a year ago to $12.00 billion. According to the report, the higher trading activity was "fuelled primarily by robust trading in US funds as investors increasingly turned to gold amid heightened macroeconomic and geopolitical uncertainty."

Meshram said, "The sharp recovery in June flows suggests that the weakness witnessed in May was temporary and largely driven by tactical profit-booking. The strong H1 mobilisation and renewed June inflows indicate that investors continue to maintain a favourable view on gold while balancing growth-oriented investments with defensive portfolio allocations.”