Safe-haven rush cools: Precious-metal ETF inflows retreat in February

February flows trail January's record amid profit booking

Net inflows into gold and silver exchange-traded funds (ETFs) moderated in February after a sharp surge in the previous month, based on changes in assets under management (AUM) of precious metal ETFs.

 

Gold ETFs ended February with an AUM of ₹1.83 trillion, slightly lower than ₹1.84 trillion at the start of the month. After adjusting January-end AUM for changes in gold prices during February, estimated net inflows into gold ETFs are held at around ₹7,000 crore for the month.

 

The final inflow data, expected next week, may differ somewhat from these estimates.

 

In January, gold ETFs recorded net inflows of ₹24,040 crore — more than double the ₹11,647 crore logged in December 2025.

 

Gold and silver ETFs have emerged among the most popular mutual fund categories in recent months, as a sustained rally in precious metals and subdued equity markets drew investor interest. In January, gold ETFs alone attracted higher inflows than the combined net inflows into active equity schemes.

 

Silver ETFs, too, are likely to have seen a sharp moderation in flows in February. Their AUM declined by more than 21 per cent during the month, largely mirroring the fall in domestic silver prices. This suggests net inflows into silver ETFs were markedly lower than in the previous month.

 

Market participants credit the moderation to profit booking after the rally in precious metals and heightened volatility earlier in the month. “Gold and silver witnessed a strong run in January. This rapid rise could have led to some profit booking by investors. The surge in volatility in precious metal prices last month may also have resulted in lower fresh accumulation,” said Sunil Subramaniam, founder and chief executive officer of Sense and Simplicity.

 

Volatility has continued into March, with geopolitical tensions in West Asia emerging as a fresh driver of precious metal prices.

 

“Gold prices are trading close to recent highs, gaining 2–3 per cent in the past few sessions mainly due to rising Iran–Israel–US tensions, which have increased safe-haven buying. In the short term, prices may stay firm if geopolitical risks persist. However, if the situation eases, some profit booking or a temporary correction could follow,” said Satish Dondapati, fund manager at Kotak Mahindra Asset Management Company.