Global Gold Fund Outflows Ease as Investors See Precious Metals Rebound Amid Indian Equity Slump

Global Gold Fund Outflows Ease as Investors See Precious Metals Rebound Amid Indian Equity Slump​

Global gold funds have registered their first weekly inflow in three months, signaling a deceleration of the steep selling pressure that characterized precious metals markets over the last quarter. This turnaround occurs even as investor sentiment towards India-focused investment vehicles remains significantly weak.

Elara Securities reported that global gold funds achieved net inflows of $317 million. This positive reading marks a reversal after witnessing nearly $14 billion in cumulative outflows across gold funds in the preceding three months. Selling pressure in silver funds has also moderated recently, suggesting investors are beginning to stabilize their appetite for precious metals.

Precious Metals Turnaround After Prolonged Profit Booking​

The improvement in precious metal flows follows an extended period of profit booking by investors in gold funds. These losses were driven by a sharp rally seen earlier this year. The moderation in selling pressure across both gold and silver indicates cautious optimism entering the sector.

India-Focused Funds Face Persistent Redemption Pressure​

While commodity market sentiment shows signs of recovery, investor interest in domestically focused equity has significantly waned. Since the start of calendar year 2026, investors have withdrawn a cumulative $9 billion from funds concentrated on India. These outflows include $7 billion from long-only funds and another $2 billion from ETFs.

The brokerage noted that approximately 60% of the inflows attracted by India-focused long-only funds between March 2023 and October 2024 have now been redeemed. Those particular funds had previously received nearly $20 billion, but nearly $12 billion has since been withdrawn, with $7 billion of that redemptions occurring in CY26 alone.

Foreign Investors Withdraw from India while AI Trade Narrows​

Among the domiciles leading these outflows were Luxembourg ($3.5 billion), the United States ($2.4 billion), and Japan ($2.1 billion). Ireland was the only major domicile listed that managed to largely escape this current wave of selling pressure.

The broader artificial intelligence (AI) investment theme is also losing momentum, according to Elara Securities. Global Emerging Market (GEM) funds, which act as a proxy for the extended AI value chain, have continued their outflow streak for the tenth consecutive week. However, redemptions slowed sharply in recent periods to just $46 million.

US and European Equities Regain Investor Favor​

In global equity markets, US funds experienced a strong resurgence after two weeks of observing redemptions. Investors poured $27 billion into US equity funds, successfully offsetting the $25 billion that had been withdrawn over those previous two weeks. Elara noted that while long-term positioning in US equities remains extended, short-term fund flow momentum continues to exhibit resilience.

European equity funds also recorded their first weekly inflow in nearly three months, attracting a modest $376 million. On the sectoral level, global industrial funds continued to receive inflows at a slower pace than seen since April 2025. Furthermore, global real estate funds have quietly emerged as a new area of noticeable interest for investors.