Physically backed gold exchange-traded funds recorded net inflows of $2.62 billion last week, marking a sharp reversal in investor sentiment.
The positive flow stands in stark contrast to the previous week, when the sector experienced its largest weekly outflow of the year as gold prices softened.
The renewed buying interest was driven primarily by investors in the United States and China.
According to Hindu Businessline, the inflows coincided with gold prices stabilizing around the $4,000 per ounce level, suggesting that market participants are viewing the current price point as a support level after recent volatility.
This shift follows a broader period of weakness for gold ETFs.
Investor demand had collapsed in the second quarter, with net flows turning sharply negative as major markets pulled back from the precious metal.