Record outflow in commodity investments seen

[LONDON] Commodity investments are heading for record outflows driven by withdrawals from gold exchange-traded funds as some investors lost faith in the traditional store of value, according to Barclays plc.

Assets under management have declined US$88 billion since the start of the year through last month, Barclays said in a report yesterday. Net outflows reached US$36.3 billion, also set for a record decline, it said. Investments in precious metals have slid 40 per cent since 2012 to US$119 billion.

"If precious metals ETPs (Exchange Traded Products) are excluded, the picture is a lot more positive," Barclays analysts led by Kevin Norrish wrote in the report. "Nevertheless we view 2014 as likely to be another difficult year for commodity investors as any clear and sustainable trends in prices will likely be few and far between."