Large banks such as JPMorgan Chase, Goldman Sachs, Citigroup, and UBS have reiterated their bullish stance on gold and predicted that the price of gold will rise, with an increase in ETF holdings.

Analysts have stated that in the coming months, the inflow of funds into gold exchange-traded funds (ETFs), especially from Western investors, will increase, providing more positive stimulus for gold prices that have already hit historical highs.

This week, gold has set new historical highs for three consecutive days. So far this year, the price of gold has risen by nearly 30% and once stood at $2,670, as it directly benefits from the loose monetary policy of central banks and geopolitical tensions. The interest rate reduction cycles in the United States, Europe, and China in recent times have stimulated bullish sentiment, and investors will pay attention to whether gold can continue to rise, including breaking the new record of $3,000.

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Exchange-traded products (ETPs) or exchange-traded funds (ETFs) allow investors to gain exposure to assets such as gold without physical delivery. Any increase in holdings is significant for prices because ETPs are based on physical commodities.

The increase in capital inflows will reduce the supply of precious metals available for trading in the market, thereby further driving up the price of gold.

Standard Chartered Bank analyst Suki Cooper said: "Now that the interest rate reduction cycle has begun, we believe that ETP capital inflows may accelerate, supporting the next round of gold price increases. ETP flows are usually more strongly correlated with real yields and the dollar, and have now turned positive. Most of the capital inflows come from Europe, but over the past two months, North America has led new interest."

Data from the World Gold Council (WGC) shows that global gold ETFs saw an inflow of $2.1 billion in August, equivalent to 28.5 tons, with all regions reporting capital inflows, and the largest inflows from the West.

North American gold ETFs added $1.4 billion in capital inflows last month, equivalent to an increase of 17.2 tons of gold. The WGC added that weak U.S. economic data, dovish rhetoric from the Federal Reserve, a decline in the dollar and yields, and a reduction in opportunity costs have driven capital inflows.

Previously, under the backdrop of high global interest rates, gold ETFs experienced capital outflows for three consecutive years. The capital inflows in the past four months have only reduced the net outflow so far this year by 44 tons.

Last week, the Federal Reserve initiated the expected interest rate reduction cycle at a pace of 50 basis points, and the European Central Bank also reduced interest rates in June and earlier this month.Large banks such as JPMorgan Chase, Goldman Sachs, Citigroup, and UBS have reiterated their bullish stance on gold and predicted that the price of gold will rise, with an increase in the holdings of gold ETFs.

Goldman Sachs stated in a report: "The Federal Reserve's interest rate cuts will prompt Western capital to flow back into gold ETFs, which have been largely absent from the gold market that has seen a significant increase over the past two years."

JPMorgan Chase pointed out this week that the inflow of funds into gold ETFs, primarily from retail investors, will be key to further sustained increases in gold prices, and it expects the price of gold to reach a peak target of $2,850 by 2025.

Ole Hansen, head of commodity strategy at Saxo Bank, said: "The current basis for new demand for gold ETFs is that interest rates are declining, but this raises the question of whether investors are prepared to buy at such high prices."