Gold-backed ETFs saw outflows in July

A one kilo gold bar is displayed in a shop in Dubai's gold souk, April 11, 2006.

LONDON (Reuters) - Gold-backed exchange-traded funds overall saw outflows in July as more stable equity markets and optimism over the outlook for the global economy boosted interest in assets seen as higher risk.

Holdings of the six gold-backed ETFs monitored by Reuters declined 3 percent in July from the previous month, with the largest outflows seen from London- and New York-based funds.

The largest gold ETF, New York's SPDR Gold Trust, said its holdings fell 4 percent in July, with 3 percent outflows also seen from ETF Securities' Gold Bullion Securities (GBSx.L) and ETFS Physical Gold (PHAU.L) products.

The Swiss funds operated by Zurich Cantonal Bank (ZGLD.S) and Julius Baer (BAER.VX) saw small inflows last month, however. One Swiss fund manager said he felt the Swiss funds were a "more trusted" investment than their U.S. and UK counterparts.

Holdings of the three silver ETFs monitored by Reuters rose 2 percent, meanwhile, with the largest rise being that of ZKB's Physical Silver (ZSIL.S) fund, which was up 7 percent.

Holdings of platinum and palladium ETFs operated by ZKB and ETF Securities also inched up last month.

ETFs, which issue securities backed by physical stocks of a given commodity, saw record inflows in the first three months of the year as risk-averse investors bought into the products as a safe store of value.