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Gold-backed exchange traded funds (ETF) experienced net outflows in August of 22.4 tonnes, as North American outflows outweighed inflows into European and Asian funds, the World Gold Council (WGC) said.

In a report, the WGC said that gold faced headwinds early in August as the dollar briefly strengthened and rising Treasury yields weighed on investment flows, triggering momentum selling shortly thereafter.

"Gold prices recovered late in the month, but it did not spur sufficient offsetting inflows, as global holdings fell to 3,611 t ($211bn) - the lowest tonnage level since May," it said.

Larger US funds were the primary source of outflows in August, as was the case in July. Global low-cost gold ETFs as well as larger funds in the UK and Germany registered the largest inflows.

Funds in North America lost 32.2 tonne in contrast to European funds, which saw inflows of 9.6 tonne. European inflows occurred against a backdrop of Eurozone inflation rising to its highest level in nearly a decade, while regional central banks cautioned that the economic recovery may be slower than expected due to Covid variant concerns.

Conversely, outflows in North America were almost entirely driven by large US funds, with the two largest alone losing nearly $2 billion combined.