By Kitco News
Tuesday November 01, 2016 14:14
(Kitco News) - Although gold-backed exchange-traded funds withstood the initial barrage of selling at the start of October as gold futures dropped 5%, investor demand was uninspiring by the end of the month.

global gold ETF demand was lackluster last month rising by only 9 tonnes last monthAccording to commodity analysts at Commerzbank, global reserves of gold ETFs saw inflows of only 9 tonnes in October, the second lowest level of monthly inflows so far this year. They noted that in the last three months, reserves have only increased by 33 tonnes.

“That is not even half the inflows that gold ETFs recorded on average per month in the first seven months of the year. This also explains why the gold price increase ran out of steam in July,” the analysts said.

The world’s biggest gold ETF, SPDR Gold Shares (NYSEARCA: GLD) saw outflows of more than 5 tonnes in October to 942.59 tonnes. Despite the outflows, gold reserves remain near their highest levels in three years.

Although ETF gold reserves fell last month, analysts are not expecting investors to give up on gold just yet. Growing uncertainty ahead of the U.S. election helped push gold prices to their highest levels in nearly a month.

December gold futures settled Monday’s session at $1,288 an ounce, up more than 1% on the day.